Bull markets don’t last forever
When the going is good,
it is easy to make money. A bull market means that prices are continuing to
rise across the board, so your investments all look very smart. However, bull
markets do not last forever and when prices finally off the cliff, you have to
be ready. Bull markets can lull investors into a false sense of security and
make them overestimate their abilities. Investors start to think that it is all
down to them and they become overconfident in their abilities. This is
dangerous when the going gets tough.
Keep things simple
Grabbing a piece of
every shiny new investment that comes along will only serve to make your job
harder, as well as making it so you don’t become a specialist. Becoming a
specialist is the best way to go because you will get a real understanding of
the markets that you are trading in. If you go for a wide spread of lots of
different investments, then you are unlikely to get a good understanding of any
of them. Diversification is good, but only up to a point.
Remember fees
Fees are the hidden
factor behind whether something is a good investment or not. Sure, you can
boast about how you bought shares and then sold them when they were twice as
high, but if the fees and commissions took out a big chunk of your earnings
then it’s not that impressive. There are all kinds of fees to keep track of – mutual fund fees, ETF
fees, RSRP fees and RRIF fees.
Always stay informed
As an investor, it is part of your job to
stay informed. The markets can be swayed by all manner of political and
economic events. Even Kylie Jenner doing a social media post about how she
never uses Snapchat any more is enough to make investors sell their shares. With
smartphone notifications, there is now an easy way to make sure you stay up to
date, all of the time. Financial news website The
Bull share tips can keep you up to date with the latest market news, and
they also offer free monthly stock tips for investors. You can also use apps such
as the Washington Post app to make sure that you are notified whenever
something big happens. You should also read and follow trading publications so
that you can get good advice about your investments.
Don’t get distracted from your strategy
When you work out a way of investing that is solid and
makes you a steady stream of money, stick with it. This doesn’t mean that you
shouldn’t change things when news and current events are going to affect your
market but it also doesn’t mean that you should get swept up in market analyst
predictions and investment strategists’ scaremongering.