Almost everyone wants a return on their investments. But not many people achieve that goal. Why? Because we make mistakes when investing our money.
Yes, I am aware that you are invulnerable to make mistakes. This is why you want to hear what you can do to improve your financial situation.
There is no doubt that without a well-researched plan and much-needed market analysis, your money will go down the drain.
I think we can all agree that the last few years haven’t been great for investors. It’s not been perfect.
That makes sense though, infrastructure projects take time to build, and it takes time for that new factory to come online.
When things are good, people are optimistic, which leads to higher valuations.
But as soon as things take a turn for the worst, investors panic and sell-off in mass numbers which cause lower valuations.
You prefer to read success stories, want to be like successful investors, and invest where they have invested.
However, According to Rolf Dobelli’s book “The Art of Thinking Clearly” –
Behind every well-known author, there are 100 other authors whose books will never sell. Another 100 haven’t identified publishers and are trailing them.
Behind them are another 100 people whose unfinished manuscripts accumulate dust in drawers, and behind each of these are 100 people who dream of one day writing a novel.
You, on the other hand, just hear about popular writers and fail to understand how improbable literary success is.
1. Following Unprofessional Advice
Patient: Help me, Doctor BadAdvice.
I keep having dreams where I am falling off tall buildings.
Doctor: I think you should follow your dreams.
Patient: Wow, that’s some good advice.
Your friends, family, and coworkers, even your doctor, are undoubtedly your well-wisher, but they are not your best financial advisors.
When you take or even act on the advice you get on social media, you end up doing more harm than good to your finances.
Everyone has turned into a mentor on social media, and this is where the Risk lies.
As they say, You are not the customer; you are the product when you get something for free.
How can anyone give you advice if they don’t know you completely?
2. Following In The Footsteps Of Other Investors
You are different. Your expectations are distinct.
Your risk mindset, your responsibilities, your family profile are all different.
So, why do you assume the expert advice given on television or in newspapers can apply to you? This is the most critical mistake you can make by imitating other investors.
Warren Buffet himself has confirmed that, “Anyone looking for investment advice should never listen to people like me.”
3. Investing With Knowing
It shows your money is not under your control, or I should claim that you don’t care about or are responsible for your money. If you have no idea where you spend your money,
Information is one of the most critical arms in any merchant's armor, not least because so many investors have little to no knowledge of such alternatives over conventional financial instruments.
However, this does not prevent investors from entering volatile and complex markets such as forex and the creation of profitable positions, especially in an age when forex broking facilitates access to many asset classes.
Remember, without knowing their basics or the most common risks to your capitals; it is counter-intuitive to invest in markets.
CONCLUSION
Similarly, there are thousands of unsuccessful investors behind any good one. As a result, to be a good investor, one must also learn from unsuccessful investors' mistakes. It would be best if you knew not only what you must do but also what you must not do.
