7 Blunders Even Smart Stock Investors Make!

BANGALORE: Investing in the stock market is one of the best things you can do with your money, provided you know what you are doing. In the stock market, as in life, nothing is certain. The vast opportunities for creating wealth by investing come with plenty of risks. Taking risks and making mistakes is part of the learning process. However, it's all too often that plain old common sense separates a successful investor from a poor one. At the same time, nearly all investors, new or experienced, have fallen astray from common sense and made a mistake or two. Even the smartest of investors do make mistakes.

Let’s have a look at some of the mistakes done by stock investors:

1. Timing the market properly

Market timing isn't something for the individual investor. The basic idea is to buy at a set price at the end of the day and then selling on the next trading day. For the individual investor, this practice seldom makes sense for two reasons: first, mutual fund rules make buying and selling costly, so profits are eaten by fees; second, the gains are fractions of pennies, so few individual investors have the cash to make these transactions worthwhile.

In short, don't do it. If you're investing in mutual funds, look for a solid fund. But if you've got the itch to make quick trades, look into trading individual stocks after hours.