Many investors like to invest less and earn more returns. They do so many things to increase their returns that many times they end up committing mistakes. What are those mistakes?
Following the herd mentality
If X number of people recommend t6his product, it doesn’t mean the same product will work for you. Don’t fall into the trap. Do your own research, find out what works best for you and go for it. Following the herd won’t make you unique.
Lack of patience in all aspects
Thomas wants this deal completed at the earliest so he signs the documents in a hurry. This is another big mistake. Rushing the deal will not give you time to verify everything.
- High expectations
Farfetched dreams will never become real yet many investors make this mistakes of daydreaming. This eventually leads to disappointment. Always set realistic expectations.
- Timing the market
Thomas jumps from one fund to another whenever he assumes that a fund is doing badly. This type of thinking is so incorrect. Thomas is bound to lose his money one day or the other if he continues this way.
- No clear goals
Having no clarity over what they want, many investors blindly go and invest. Being clear on financial goals, time horizon and appropriate risk for those goals are essential. Otherwise, there isn’t any point in investing or insuring oneself.
- No diversification
Putting all eggs into one basket is fatal for you. One loss and all your money will be gone. Instead, diversify your assets into different funds. This helps you avoid too much loss of money.
- Emotions win over rationality
We are all humans and are bound to have emotions. However, sometimes those emotions get in the way of rational thinking and hamper our decision making. Being emotional in finance will prove disastrous.
- Forgetting inflation
Inflation has always been on the rise. Even while you are reading this, inflation is rising! Many investors forget this and don’t invest properly to beat inflation. The older generation especially says “Value of money is reducing as prices are rising”.
You can learn more such mistakes and how to avoid them by visiting www.moneymindz.com or give a missed call to 022-62116588
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