"How Could I Have been Such an Idiot?" if you have never yelled that sentence at yourself in a fury, you are not an Investor.
The findings suggests that much of what we've been told about investing is wrong. Theoretically, The more we learn about our investments, and the harder we work at understanding them, the more money investor will make.
In Practice, however, these assumptions often turnout to be dead wrong. Investors habitually are their own worst enemies, even when they know better.
- Everyone knows that they should buy low and sell high- and yet, all too often buy high and sell low.
- Everyone knows that beating the markets is nearly impossible- but just about everyone thinks he can do it.
- Everyone knows that panic selling is a bad idea- but a company that announces it earned 4 rupees per share instead of 5 rupees per share can lose 5 billion of market value in half a minute.
- Everyone knows that market strategist can't predict what the market is about to do- but investors still hang on every word from the financial pundits who prognosticate on TV.
- Everyone knows that chasing a hot stock is a sure way to get burned-yet millions of investors flock back to the flame every year. many do so even though they swore, just a year or two before, never to get burned again.
Ideally creation of wealth is very simple, it needs
- Realistic and achievable objectives.
- Calm and patient investing.
- Investing according to the Risk profile.
- Use the news and tune out, Ignore the noise in the market.
- Give time to the investments instead of timing the investments.
- Appropriate asset allocation and timely re-balancing of Portfolio.