That Every Stock Market Investor Mistakes | Golden rules of investing in stock markets | Stock Market Tips for Beginners

 Every Stock Market Investor Mistake

1. Investing Too Much Time

 Investing takes time, and anyone who tells you otherwise is lying! You need to commit yourself to investing and make sure you do not procrastinate. However, don't spend hours upon hours investing; rather invest 5-10 minutes each day and build your portfolio over time.

 

2. Not Having Your Own Money

 If you do not have your own money, then you should never even consider getting involved in stock trading. What if things go wrong? Who's going to pay for the losses? Remember to always start out small and only invest what you can afford to lose.

 

3. Ignoring Negative News

When the news is bad, do not ignore it. This could mean losing some money down the road. Always take everything into consideration before making any decisions. Do not put all your eggs in one basket.

 

4. Being Overconfident

Many people believe they can easily beat the market and make millions; however, this only happens to people who actually know how to trade. Stay humble and keep learning.

 

5. Taking Risks That Are Unreasonable

Never risk more than you can afford to lose and never risk more than you can cover. There is no point being careless with your investments.

 

6. Failing to Take Advantage of Investment Opportunities

Make use of all investment opportunities you find throughout the year. Sometimes it can be hard to find good deals but remember that patience pays off.

 

7. Investing at the Wrong Times

Don't put all your eggs in the same basket. Spread your money around to different companies and sectors, especially after bear markets.

 

8. Buying Low and Selling High

Do not buy stocks at their lowest prices, this is where many investors get into trouble. Instead, wait until they reach the peak of their highs before selling them.

 

9. Diversification

Never put all of your money into one company. Instead, spread your money across many different industries. This way if one goes down, it won't affect your entire portfolio.

 

10. Keeping Your Portfolio Managed by Someone Else

Never let someone else manage your investments. Know exactly where your money is coming from and where it is going to.

 

11. Trying to Catch a Falling Knife

Do not try to catch a falling knife, instead stay calm and stick to your plan.

 

12. Putting All of Your Eggs in One Basket

Don't place all of your investments in one area. Find stocks that suit your personal preferences and diversify your portfolio accordingly.

 

13. Investing Without a Strategy

Have a strategy in mind before you ever begin investing. Otherwise, you may end up wasting your time if you end up picking something random.

 

14. Thinking Smaller Stocks Better Returns

Investing in smaller stocks does not necessarily mean you'll get higher returns. Look at a larger picture and think about your future goals and long-term plans. After all, bigger isn't always better.

 

Golden rules of investing in Stock Markets

1. Buy low, sell high

 The first rule of investing in stock markets is to buy low and sell high. Buying low means buying stocks at their lowest prices. Selling high means selling stocks at their highest prices. By doing this, you make sure that you get the maximum profits out of your investments.

 

 2. Don't invest more than what you can afford to lose

 This is the second rule of investing in stock market. You should never invest more money than what you can afford losing. If you do not have enough money to cover your losses, then you should not invest in stocks.

 

 3. Never invest more than 10% of your total portfolio

 You should never invest more than 10 percent of your total portfolio in any single company. Investing more than 10 percent of the total amount of your portfolio in a single company could lead to loss of your entire investment.

 

 4. Always diversify your portfolio

 Diversification is the third rule of investing in stock. Diversification means having different types of companies in your portfolio. Having a diverse portfolio helps reduce risk.

 

 5. Be patient

 Patience is the fourth rule of investing in stock exchange. Patience is necessary if you want to earn good returns. You need to wait until the right time before you decide to sell your stocks.

 

 6. Know your risks

 Risks are the fifth rule of investing in stock exchanges. Risks are unavoidable. However, you should know how to manage them. You should always look for ways to minimize your risks.

 

 7. Keep track of your portfolio

 Keeping track of your portfolio is the sixth rule of investing in stock trading. You should keep track of your portfolio to ensure that you are making profit from your investments.

Stock Market Tips for Beginners

1. How to start investing?

So, first thing’s first, I would recommend reading any book written by Warren Buffet or Benjamin Graham about stock market, to learn how markets work and get your head around money management. If you are not sure who these guys are, they were two of the greatest investors of all time and their advice is still followed today.

 

2. Start early!

The best times to invest in the stock market is before you have a family and a mortgage. You won't need the money until then, so you can afford to take risks without worrying about losing everything. Once you do have kids and a house, you should probably wait at least 5 years after you get married, if not 10 years. That way, you are going to have some financial security in place before you begin investing. Ideally, you want to be financially stable before you even think about buying shares.

 

3. Set a goal!

When you first start investing, set yourself a small goal like $1000, so you know what success feels like. Then break that number down into smaller goals like $100 per month so that you feel comfortable with your progress. When you reach those smaller goals, make them bigger! so for example, once you hit $1000, add $100 each month until you have reached your target amount.

 

4. Learn more about stocks!

There are many books out there to help you learn more about the stock market. My favourites are "How to Make Money in Stocks" and "Rich Dad Poor Dad". There's tons of information out there, but I find these 2 books to be the easiest to understand. Both of them teach you the basics about investing and give you lots of examples to follow along.

 

5. Read news and blogs!

Like I said earlier, there is a lot of information out there. One good place to start learning about stocks is from the mainstream media. Companies love to talk about themselves in the media! Read newspapers and listen to the news. Also, read blogs or watch videos online about companies that interest you. These people are digging deep inside company websites and talking to employees to really find out what makes the company tick.

 

6. Be patient!

Don’t expect overnight returns. Even world class investors don’t always beat the market, and anyone who tells you they have done just that is lying. Don’t fall into the trap of thinking that you can “day trade” your way to riches. Day trading simply means trying to predict price movements only a few minutes ahead of everyone else. The reality is that day traders almost never beat the market over the long term.

 

7. Have fun!

Finally, remember that this isn’t supposed to be stressful. Don't let the fear of making mistakes put you off getting involved. Take calculated risks, but don't get too carried away. Remember, the stock market is full of stories of people who lost everything because they didn’t pay attention to details and got greedy. Just keep focused on your goal, stay disciplined, and you’ll be fine.