Investment Strategies - Mistakes You Need to Avoid

Not all investment strategies turn out to be positive and lucrative. There are investment schemes that go sour, particularly if the tactics employed are solely based on hunch and speculation. If you are planning to put your money in the stock market with wealth creation in mind, then you have to be careful with your decisions and choices. The Bernie Madoff Ponzi Scheme is a wake up call to all investors. If a deal is too good to be true, you need to think 10 times before being part of it because it probably is some kind of a scam. Also, this recent Ponzi scheme shows that merely believing in the reputation and character of a person is no longer a good gauge on whether the wealth creation opportunities should be considered. To guide you on what type of investment or stock market strategies to avoid, simply read on.

Get rich quick investment strategies are something that you have to distance yourself from. Majority of people who tried their luck the easy way were burned at the end. In fact, there are even cases where veteran investors were also duped by schemes, so you have to be careful. The first thing that you should ask yourself is how the investment would grow double and triple in just a few months. If there is no logical or believable explanation, then you should not even consider the opportunity. Probably the only way your money could grow that high or that fast is if you invest in illegal activities, which you never want to get involved in. In order not to be tricked by smooth talkers into such scams, you need to know what you are investing in. It is best to study the opportunity first so that you will have a good grasp of how the investment will help you achieve your wealth creation goal.

Many people claim that a penchant for gambling is part of good stock market strategies. If you have so much money to spare, then probably gambling with your investment strategies is alright. However, if you are an average bloke who dreams about getting rich via investment in options, mutual fund, foreign exchange and stock market, then you should not be too eager to gamble. You should never base your decisions on pure gut feel. It would always be better if you somehow make an intelligent assessment of the situation and consider your options rather than jumping on an investment with eyes closed. Besides, even good poker players do not solely base their play on chance, but instead on great inference and analytical skills.

One of the mistakes in investment strategies that you also need to avoid like plague is the "set and forget" attitude. In movies people who invested in Apple (like Forrest Gump) suddenly find themselves as millionaires after a couple of years. In real life, however, this is hardly the case. Thus, when you invest in the stock market (or any type of market, for that matter), you should always track your investment or money. Learn when to sell and buy and you will go a long way.

Ashley_Byres

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