KredX Blog KredX Blog
  • HOME
  • PRODUCTS
    logo

    FOR BUSINESS logo

    logo

    FOR INVESTORS logo

    Invoice Discounting

    Unlock money tied up in unpaid invoices

    KNOW MORE

    KredX Pay Later

    A closed loop financing for your dealers/distributors/Retailers

    KNOW MORE

    KredX Cash Management Solutions (CMS)

    Get real-time analytics. Manage disputes. Minimise risks. Get risk-free returns

    KNOW MORE

    KredX Global Trade

    Get Quick Finance To Fund Your Import-Export Requirements

    KNOW MORE

    Invoice Discounting

    Diversify your portfolio with alternative short-term investments

    KNOW MORE
  • PARTNER WITH US

    Business Partner Program

    Accelerate your client’s business growth and get attractive payouts on time

    KNOW MORE

    Financial Advisor Program

    Grow your credibility and clients’ investment portfolio

    KNOW MORE
  • KNOWLEDGE CENTER

    FAQs

    Blog

    Knowledge Base

    Webinars

    Reports

    WhitePapers

    Podcasts

  • COMPANY
  • LOGIN / SIGNUP
  1. Home
  2. Finance Planning
  3. 5 Steps To Avoid Investment Mistakes
 5 Steps To Avoid Investment Mistakes
Finance Planning Investments Investor Short-term Investments

5 Steps To Avoid Investment Mistakes

by KredX Editorial Team December 19, 2019 0 Comment

The sole intention of investments, in the long run, must be to build wealth and that too the right ones. 

We all have our inhibitions in taking the right decisions in life, and it is no different when it comes to investing either.

Before investing, it must always become a habit to choose the right ones to substantiate the wealth and time committed, no matter how big or long the investment is. Refraining from investments is a bad idea because you would lose out on the benefits in the latter part of your life.

Here are 5 handy tips to invest wisely.

Step 1: Stop Postponing

One of the most common mistakes observed among people is waiting for long periods to begin investing. For instance, when the market is bullish, people wait for corrections. However, when the stock value is on the downside, people wait for the value to fall further. Postponing can prove to be an obstacle and reduce the chances of accumulating wealth.

Solution: Consider lining up investments to your goals. Imagine, to build a retirement corpus of say for 30 years, the fluctuations in the market conditions shouldn’t influence your investment thought process. Hence, it is prudent to start investing without wasting time further and hold on until you achieve the goals.

Step 2: Betting Big On Recent Returns

Once you have begun investing, it’s a natural tendency to pick investments that have been profitable in the recent past. Investing in a mutual fund or stock due to its recent outperformance and chasing it expecting the same might not always end well.

Solution: Study and analyse how a stock or mutual fund has performed in different market conditions. It’s a no brainer that most of the investments do well when the markets are rising, but the great ones will stand out even in tough times. These are the investments to be chosen as protecting wealth is equally important as building it.

Step 3: Stop Stuffing All Eggs In One Basket

A common misconception among investors is to stuff all eggs (funds) into a single basket (investment portfolio). However, it must be noted that holding too many investments of the same kind may not add up to an investor’s portfolio.

Solution: Diversifying or investing in different types of instruments is the key. Invest across asset classes (equities, bonds, real estate), styles (growth, value, passive), market cap (large-cap, mid-cap, small-cap), and sectors and industries (FMCG, pharma, technology). It is necessary to diversify as all investments do not perform well at the same time.

Step 4: Stop Over Analysis

Understandably, keeping track of the performance of your investments on a daily basis can’t be avoided, but over-analysis can be futile. Most investors judge their decisions on short-term fluctuations instead of long-term goals.

Solution: Check how your investment portfolio is doing intermittently, but not too regularly. For most long-term investors, checking once or twice a year would be ideal. Monitor the performance of the portfolio every six months or annually and buy, sell, or rebalance decisions accordingly.

Step 5: Stop Being Emotional

There is no room for emotions in investments as it will only harm and not better your decision-making capability. Two such feelings that can control your investments are fear and greed. While fear can prevent an investor from investing, greed can encourage the investor to redeem instead of holding.

Solution: Logic must prevail over emotions, and the focus should be diverted towards goals and objectives. Irrespective of how the markets are doing investing should be continuous.

Bottom line

Mistakes are part of the learning curve making you realise that it’s fine as long as it was not deliberate. Arriving at a hasty decision of pulling out of the investments can be detrimental to better returns; so hang on and reap the benefits when they mature.

Share This:
Tags: alternative investment Financial goals Investing Investment Mistakes investment options Investment Portfolio investments Mutual fund short term investment
Previous post
Next post

KredX Editorial Team (Website)

administrator

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Enquire now

  • Invalid value

  • Invalid value

  • Invalid value

The Best Of Alternative Investments, Now On Your Phone

Download App:

KredX Blog KredX Blog

Wing ‘A’, Ground Floor, Office-1 Block-‘A’, Salarpuria Softzone, Bellandur Village, Varthur Hobli, Bangalore South Taluk, Outer Ring Road, Bangalore – 560103

+1 212-602-9641

info@example.com

Get More Location

Follow us:

Download app:

Company

Home
About Us
Careers
Contact Us
Our Offices

Resources

Blog
Reports
Whitepapers
Knowledge Base
Podcasts
Webinars

Support

FAQs
Talk To Our Advisor
Chat With Us
Sign Up
Login

Legal

Nodal Officer Name: Amrutha A / Ph: 08061799200, IVR-9 / Email: Amrutha@Kredx.Com
Terms And Conditions
Privacy Policy

Investor Products

Invoice Discounting
Bonds
Digital Gold/Silver
KredX Assured

Business Products

Invoice Discounting
Buy Now Pay Later
KredX Cash Management Solutions
KredX Global Trade

Quick Links

Business Partner Program
Financial Advisor Program
Business Suite
©2022 Minions Ventures Pvt Ltd