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The 5 Mistakes Every Investor Makes and How to Avoid Them: Getting Investing Right QUOTES

The 5 Mistakes Every Investor Makes and How to Avoid Them: Getting Investing Right QUOTES

1 " ...there should be no place in a portfolio for hedge funds. There are lots of reasons, but the main one is simple: Investing in hedge funds is a great way to increase the odds of underperformance. "

― , The 5 Mistakes Every Investor Makes and How to Avoid Them: Getting Investing Right

2 " I never use hedge funds because I am well aware of what drives future performance, and hedge funds start out with a great disadvantage in every major category: taxes, fees, risk management, transparency and liquidity. "

― , The 5 Mistakes Every Investor Makes and How to Avoid Them: Getting Investing Right

3 " The stock market cares about only one thing above all else: anticipated earnings. If companies make more money, their share prices eventually rise. The stock price is simply a reflection of a company's earning power. Everything else is noise. "

― , The 5 Mistakes Every Investor Makes and How to Avoid Them: Getting Investing Right

4 " Rather than be fearful and sell out at the worst time or get greedy when the market is way up, investors should control their emotions and not only avoid panic, but embrace the market volatility for what it is: an opportunity and a gift. Suffocate the instincts that want to make you a bad investor and rather embrace the chaos that normally causes them to rise to the surface. "

― , The 5 Mistakes Every Investor Makes and How to Avoid Them: Getting Investing Right

5 " Gold belongs only in the portfolios of fearmongers and speculators. If you own gold in your portfolio, expect to not get paid an income, pay higher taxes on your returns, take a more volatile ride than the stock market, and get a long-term return lower than bonds. "

― , The 5 Mistakes Every Investor Makes and How to Avoid Them: Getting Investing Right

6 " There is ample evidence that confirmation bias permeates throughout investors' decisions. For example, once an investor likes a stock, he is likely to seek out information that validates that stock. In a 2010 study, researchers showed that investors used message boards to seek out information that validated rather than challenged, stocks they owned (Park et al. 2010). If we own a stock, we tend to look for anything that validates our decision to buy it, and to reinforce why we should keep holding it. "

― , The 5 Mistakes Every Investor Makes and How to Avoid Them: Getting Investing Right

7 " Descarte said, “Man is incapable of understanding any argument that interferes with his revenue. "

― , The 5 Mistakes Every Investor Makes and How to Avoid Them: Getting Investing Right

8 " The media's job is not to inform you; it is to get eyeballs. Eyeballs lead to advertising revenue. That means they need people to read stuff and view stuff. Telling everyone things are going to work out just fine doesn't get eyeballs the way feeding into fear does. That doesn't just explain financial news; it explains most of the news. "

― , The 5 Mistakes Every Investor Makes and How to Avoid Them: Getting Investing Right

9 " A good list of questions to ask your advisor will include the following: Where will my money be held? Right answer: Somewhere else! Are you a broker? Right answer: No! Are you a dually registered advisor? Right answer: No! Do you or any affiliate have proprietary investments of any kind? Right answer: No! How are you compensated? Right answer: Total disclosure in writing and never make commissions on any investment product. What are the credentials of you and/or your team? Right answer: If planning is involved, a CFP is ideal to have on the team. What is your planning and investment management approach? Right answer: The firm should follow a coherent philosophy rather than a bunch of different strategies (unprincipled) and should follow an approach that does not involve market timing or active trading. "

― , The 5 Mistakes Every Investor Makes and How to Avoid Them: Getting Investing Right

10 " Loss aversion in all of its forms perhaps causes more damage among investors than any other group. Loss aversion is the reason investors sit in cash, despite knowing full well that they are purposefully and willfully losing the purchasing power of their money. The average money market yield has been well below inflation for decades. Despite that fact, investors are willingly losing a little each day to avoid potential losses with real investments. With a plan like this, purchasing power can be cut in half in just 24 years! "

― , The 5 Mistakes Every Investor Makes and How to Avoid Them: Getting Investing Right

11 " Man is incapable of understanding any argument that interferes with his revenue. "

― , The 5 Mistakes Every Investor Makes and How to Avoid Them: Getting Investing Right

12 " History doesn't repeat itself, but it rhymes. —Mark Twain "

― , The 5 Mistakes Every Investor Makes and How to Avoid Them: Getting Investing Right