Seven Mistakes to Avoid
1. Dont try to shoot for gains by finding the next Microsoft. Instead, focus on finding solid companies with shares selling at low valuations.
2. Undestanding the market's history can help you avoid repated pitfalls. If people try to convince you that "it really is different this time," ignore them.
3. Don't fall into the all-too-frrequent trap of assuming that a great product translates into a high-quality company. Before you get swept away by exciting new technology or a nifty product, make sure you've checked out the company's business model.
4. Dont be afraid to use fear to your advantage. The best time to buy is when everyone else is running away from a given asset class.
5. Attempting to time the market is a fool's game. There's ample evidence that market cant be timed.
6. The best way to reduce your investment risk is to pay careful attention to valuation. Dont make the mistake of hoping that other investors will keep paying higher prices, even if you're buying shares in a great company
7. Cashflow is the true measure of a company's financial performane. not reported earnings per share.
1. Dont try to shoot for gains by finding the next Microsoft. Instead, focus on finding solid companies with shares selling at low valuations.
2. Undestanding the market's history can help you avoid repated pitfalls. If people try to convince you that "it really is different this time," ignore them.
3. Don't fall into the all-too-frrequent trap of assuming that a great product translates into a high-quality company. Before you get swept away by exciting new technology or a nifty product, make sure you've checked out the company's business model.
4. Dont be afraid to use fear to your advantage. The best time to buy is when everyone else is running away from a given asset class.
5. Attempting to time the market is a fool's game. There's ample evidence that market cant be timed.
6. The best way to reduce your investment risk is to pay careful attention to valuation. Dont make the mistake of hoping that other investors will keep paying higher prices, even if you're buying shares in a great company
7. Cashflow is the true measure of a company's financial performane. not reported earnings per share.