From
time to time, even the most successful
investors will hit a losing streak. When
this happens, people have a tendency to fall
into these psychological traps:
Making investing a full-time job: spending hours each day
trying to beat the market and make their
money back
Denial and rationalization:
watching your stock fall and refusing to
accept that it’s going to fall further.
Trying to explain away bad decisions and bad
market situations.
Avoidance: delaying
actions, like selling a stock
and taking a loss or buying one
because the price is “too high”
Projection of blame:
blaming someone else for your
bad decisions, not taking
responsibility for your mistake
Idealization: putting
your faith in a particular stock
or the opinions of a financial
guru and following them blindly
Idealization: putting
your faith in a particular stock
or the opinions of a financial
guru and following them blindly
Idealization: putting
your faith in a particular stock
or the opinions of a financial
guru and following them blindly
Burying your head in the
sand. This can turn into
wishful thinking where the
investor begins to believe his
own fairy tale
Sometimes it's good to have a
trusted friend or advisor evaluate
your investing habits and the way
you react when your investments are
not going well. Sometimes you've got
to take a step back and take a
serious look at your investing
style.
Other Stock Market Basics
Topics:
-
Stock Market Investing – the
Right Way
-
More Stock Marketing Investing
-
How to Pick Winning Stocks
-
The Golden Rule of Investing
- Avoid Psychological Traps to
Have Successful Investing
-
Changes in Stock Values Can Be
Big Numbers
-
How to Invest Smart
-
Stock Advice - Important Selling
Rules
-
Poor Stock Buying Decisions
-
Market Indicators
-
Stock Market Cycles
-
When a bear stock market may not
be a bear market
-
Stock Index Futures
-
Four Things that Affect Stock
Valuation
-
What is a P/E ratio?
-
Value Investing
-
Cheap Stocks
-
What is a Financial Statement?
-
Analyzing Financial Statements
-
Stock Market Tip - Red Flags to
Look For When Investing?
-
The Annual Report – How to Read
-
Stock Market Analysts – Stock
Market Advice and Tips
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