People do their own investment activities every day. However, the smart ones know a few things that many others do not. There are common mistakes that the intelligent crowd knows well. Here are a few you might want to know about. Many people made the first mistake when the market took a nosedive a couple of years ago. When trouble comes, the hardy investor stays in the market. Some investors decided to pull their money from the market. That is the mistake. Keeping the funds in the market allows you to purchase stock and funds at discount prices.
Another common mistake is failing to diversify your investment portfolio. Even an aggressive investor needs to mix up what their portfolio contains. It helps a portfolio deal with the ups and downs of single stocks. Too much of one product puts a portfolio on the roller coaster. Along these same lines, another common blunder is putting all your money into stocks or mutual funds. You need to keep some funds available for short-term needs. Certificates of deposit and money market accounts provide some bit of interest but keep funds readily available.
Another oversight many people make is not checking investment advice
before taking it. Just because your best friend gives you a "guaranteed" stock
pick, doesn't mean you should accept it. Learn to investigate advice you
receive before acting on it. You may find the sure pick is actually a dud in a
fur coat before you lose money. On this same line, make sure you keep up on the
latest information on the areas you put your money. Putting your money in a
financial product then forgetting about it is a large mistake. When you keep up
on trends, you will know if your money is safe or not. Look for dividend paying stocks or other investments that pay well over time.
The final mistake people make is making any investment without a map. You need to know where you are going to make decisions on where you put your money today. Without a long-range plan, you make decisions without thought. Whether you pull your money too soon, fail to mix up your portfolio, forget to keep up on vital information, or lapse in making a plan, you make mistakes. Moreover, any of these mistakes put your financial future in jeopardy. You can take the time to do things right or let things go as they will. It is completely up to you. Are you a smart one or the other type?