Finance Articles

Top Ten Investment Mistakes

1. Lacking an investment plan a/k/a/ "Don't take a trip without packing the map". A pre-planned asset allocation generates positive results and eliminates emotional panic selling.

2. Buying cheap stocks a/k/a "Road crews erect "Dead End" signs for a reason". Most stocks with low share prices also arrive at the bottom for a reason. There must be institutional interest to influence price, and many won't even glance at stocks below $8 or $10.

3. Purchasing story stocks a/k/a "A good fable lulls a child to sleep". Don't get taken by compelling "story" stocks. The plots include a cure for cancer, a big oil strike or a revolutionary invention. Such promising stories rarely prove true. If the "story" materializes, the company will still be a buy.

4. Selling your winners a/k/a "You gotta know when to hold 'em'". Don't sell your winners. These companies combine outstanding management, product and cash flow, creating steady growth for years. Holding these companies for the long run will compensate for other investing mistakes. In fact, one or two big winners can create real wealth.

5. Holding onto a peaked stock a/k/a "Trees don't reach to the heavens, and companies don't continue growth beyond reason". Top companies peak for reasons such as attrition of top management or competition. Systematic pruning will help you avoid a rotting, unhealthy investment.

6. Under diversification a/k/a "Ideas are good, but a mind full of them is better". Resist the urge to rely on a few stocks that you know. Lack of portfolio diversification leads to erratic and volatile returns, and owning several companies in the same industry also isn't diversification. The best investment results happen by investing in leading companies across various industries.

7. Over diversification a/k/a "A portfolio stretched like an old T-shirt won't help an investor benefit from their insight". You don't create diversification by spreading yourself too thin. Although a mind full of ideas is good, ideas acted upon on a whim waste good thoughts.

8. Over trading a/k/a "Replanting a garden every week won't produce high-quality tomatoes". Don't follow market "noise" and bounce from sector to sector or theme to theme. This prevents investors from enjoying the rewards of a long-term winner. Give stocks enough time to mature and compound.

9. Too much margin a/k/a "Living on borrowed time brings a rush of excitement, but it's a quick trip when time expires". Don't underestimate the damage margin can create. The relatively low cost and ease of obtaining leverage takes investors down a dangerous path. When a portfolio on margin declines rapidly, it can catch even experienced investors off guard.

10. Too many options a/k/a "In life there's always options, (but timing makes the difference"). When you buy options, you must be right and use impeccable timing. Options allow an investor to use leverage and control more shares but there are relatively high spreads involved in trading them. Many times investors lose money on their transaction even after they followed correct assumptions.

Mr. Kimmel is a private money manager and the author of "Magnet Investing, build a portfolio and pick winning stocks using your home computer". His methodology was the subject of a Forbes Magazine article (June, 2004).

Barbara Kimmel is an award winning publisher and publicist at Next Decade, Inc. (http://www.nextdecade.com).

Other Article Sites

findabook.com  moneycd.info  a-mortgage.info   about-lemon-laws.info  aboutstudentloans.info
all-about-publishing.info  auctions-articles.info  bestcollege-university.com  bestispconnection.com
biblefolder.com  blogger-website.com  books-used.info  brokers-guide.info  buywindows.info  cable-dsl.info
career-miner.com  carpel-tunnel.info  cashinaflash.info  cashloanreviews.info  casinobell.com  chat-house.info
clearmycredit.info  collegeloantips.info  crones.info  depression-articles.info   dirnic.net  dishguides.info
divers-below.com  expodog.info   financewizz.com  fire-insurance.info  getgood.info  handleit.net   it-idea.info
health-supplies.info  hosting-right.com  insidealert.com  insurance-facts.info  jobs-employment.info
justgood.info  lookgold.net   lowcost-travel.info  money-source.info  myhostzone.info  numisblog.com
peoplesearchfinder.info  pr-articles.info  realeas.com   refinancing-guides.info  spyware-remove.info
telelot.info  the-law.info   toppaid.info  travel-deals.info  travelcorrect.com  wedding-guide-site.com
your-blog.info  your-credit.info

FavoriteAgent.com Introduces In-House Mortgage Company: Hewlette & Levinson Financial Services Joins Internet-Based Real Estate Brokerage
FavoriteAgent.com and Arrington, Edgar & Shiel (AES) announce a joint venture in the formation of Hewlette & Levinson Financial Services (H&L). This new North Carolina company will offer mortgage services to FavoriteAgent.com 's residential and commercial real estate customers, numbering approximately 55,000 every month from its 1400 markets.

Finance for Life, Premium Finance Industry Leader, Continues Getting Cases Funded Despite Industry Turmoil
In an apparent shut down of several funding sources, it has been noted that as many as six lenders have lost their funding sources or have had a delay in receiving their funding. This has caused a sudden and unexpected cessation of the funding of many life insurance premium finance cases. Agents and their clients have been left in shock and are scrambling to find reliable funders. Finance For Life is committed to excellence in service and personal and professional attention to all cases. As such, Finance For Life is positioned to absorb a substantial case load for those looking to place cases that lenders have been unable to fund.

MLS Reverse Mortgage Now Offers Fixed Rate Reverse Mortgages
To alleviate the uncertainty of adjustable rate reverse mortgages, MLS Reverse Mortgage has added the fixed rate reverse mortgage to their product line.

Tips to Make Your Mortgage Shrink
For nearly all homeowners who have a mortgage on their house or condo, they dream of the day when it is finally paid off in full Having that legal document in hand that says you are free of debt and the property is in your name is an extremely satisfying life-long goal for many people

Check Your Mortgage Application Rights
Consumers looking to buy homes should know that they have certain rights under the law. The more commonly known laws are The Equal Credit Opportunity Act (ECOA), the Fair Housing Act, and the Fair Credit Reporting Act (FCRA). These federal laws prohibit discrimination and provide consumers with the right to obtain certain credit information.

Cyprus Property For Sale is a Great Investment
Cyprus property for sale in and around Larnaca is a great investment due to the improvements being made to the infrastructure of the area and with the cost of a cheap flight only to Larnaca in Cyprus coming down all the time this could be the perfect location for either a holiday home or relocation The flying time of four and a half hours from the UK is longer than other Mediterranean countries, but the price of a cheap flight only to Larnaca in Cyprus is coming down with the introduction of more ?no frills' airlines on the route from most British major and regional airports, also on flights Cyprus to UK

Oil and Gas Field Investment Turns Quick Profits for Trump University Real Estate Graduate
Federal government IT consultant invests in underdeveloped US oil and gas fields after attending Trump University investment introductory class.

Bridging the Gap Between Finance & Talent Management
Globoforce Study Reveals Critical Need for Finance and HR Collaboration; Identifies Chief Talent Officer as Next Vanguard of Corporate Governance

Apartment Complex Commercial Mortgage Loans
A2ZBigLoans.com offers low rates on apartment complexes, condos, and duplex buildings and more. We offer loans from $250,000 to over 10 billion. Since January 2008 we have funded over $1 billion dollars in commercial loans around the world.

Six Simple Steps for Getting More Mortgage Applications
When I first started out as a loan officer, one of the things I found to be the toughest, was taking an application over the phone. I just didn?t seem to have the skills, nor did I have a plan. I was literally calling people on the phone and saying something to the effect of; Hello, my name is Jay Conners, and this is what I do, and this is why I am calling, would you be interested? No wonder I wasn?t having any success.

Banzai Launches Personal Finance Web Application Aimed at Cash-Strapped Consumers
Banzai prepares consumers for an economic downturn by offering a hands-on approach to personal finance with a focus on controlling spending and getting out of debt.

A Cheap Mortgage Insurance Quote Can Help You Maintain Your Mortgage
Many things have been said about payment protection insurance of which mortgage insurance is one part One of the things said about it is that it is nothing but a huge "rip-off"

Reverse Mortgage Site Releases New Informative Guide
My Reverse Mortgage Pro, an online source of information about loans for senior citizens, is providing answers to common misconceptions.

Ansbacher Investment Management to Launch Pure Equity Index Variance Swap Strategy in Q3
Ansbacher Investment Management, Inc. (http://ansbacherusa.com) plans to launch an equity index variance swap strategy in the third quarter of this year to take advantage of the persistent overpricing of broad based equity index volatility.