Three Deadly Sins of Investing

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Overlooking Fundamentals: Many investors purchase shares without sparing time to collect the basic information regarding the company, most importantly the service or product that the company sells and the possible future for that business.

“Retail investors acquire carried far by a management overoptimistic tentative expansion plan, speeches and are always sloping towards short-term play, Not at all wanting to miss the present surge in the value of the stock,” says Vivek Tyagi, Head of research, Trifid Research Advisory.

Investors should look at many companies that have constantly delivered earnings growth and first-class corporate governance. Always never invest in a firm lacking understanding the dynamics of the big business.

Cheap, Yet Expensive: A victorious investor looks for good deal stocks, the ones which are obtainable for prices lesser than their worth and have a forcible growth potential. Newbie investors frequently misinterpret this golden policy as buying ‘cheap’ stocks for high division gains.

“Retail investors seem at the share value of the stocks. They tend to purchase cheap stocks, which might not be extremely valuable,” says Lydiya Thomas, Vice President of  Trifid Research.

The returns from your investment in shares don’t depend on the amount of shares, but the execution of the company. You will have a superior chance of making an income if you purchase just one share of any   chip company rather than purchasing thousands of penny stocks.

Following Tips: Thanks for uncostly bulk messages, you might have derived SMSes tipping you about a golden chance to earn huge profits. If you have performed on any of these Stock Tips, nifty tips, currency tips, you probably have lost few money. If you have not, you have done well to stay away from such incredulous mails and messages.

Even requested tips can do you spoil. If you try to find Stock Trading Tips on the Internet, you will get a huge number of blogs and websites that offer you free guidance. Don’t take the suggestion on these sites as gospel. It is equally dangerous to purchase shares because an expert told you that “its price is going to twice in 6 months”. Equity Tips by analysts published in newspapers should also be subjected to scrutiny.

Allowing your Broker to Trade: If you presently sign the forms on your agent’s directions and allow him to sell and buy shares on your behalf, be prepared for a few shocks. Unblushing brokers often use this chance to misuse clients’ capital.

Brokers do not get a commission on the income you earn, but get paid to buy and sell volume. There have been bags of brokers using investor money for Intra day trading without investors consent. When you get a report from your brokerage home, you might observe your portfolio running losses with a vast amount paid as brokerage.

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