Investment Mistakes You Should Avoid

Written by Bloom Investment Counsel, Inc. on July 31, 2023. Posted in Investing.

Investing is something that should be part of your everyday life. It may be as simple as leaving your money in a company retirement plan or as complex as attempting to actively manage your own stock portfolio.

However you invest your money, there are common mistakes that most investors fall prey to but that you can easily avoid with proper planning and application.

Not Having a Clear Investment Plan

The best time to start investing was yesterday. The next best time to begin is today. However, one of the worst mistakes you can make is to be impulsive. Before you invest, take the time to establish your investment goals and formulate a plan.

You may have more than one investment goal with each requiring a different investment approach. It is quite common to have separate short-term, mid-term, and long-term investment goals.

Letting Emotions Drive Your Decision Making

Emotions and successful investing don’t mix. Listening to the media about the latest hot investments and/or watching market returns daily can give you anxiety and encourage you to make impulsive investment decisions. Once you establish your investment plan it is best to stay the course and ignore day-to-day market returns and media noise.

Not Diversifying Your Portfolio

Diversifying your portfolio by investing in a mix of investments and/or asset classes such as stocks, t-bills or bonds, and cash will decrease the overall risk of your portfolio. You should avoid having too much of your portfolio invested in only a few stocks or in one asset class.

In a properly diversified portfolio, when some holdings are performing poorly, others will be outperforming to provide a total portfolio return that should consistently meet your goals.

Not Getting Help from Experts

There is a multitude of investment professionals who are willing and able to provide you with all the education, advice, and assistance you may need. Do not enter the investment markets blindly as these markets are dominated by investment professionals.

Make sure that you are on an equal footing by having an investment professional in your corner. Obtain whatever level of assistance you may need to establish your investment plan and thereby select the appropriate investments.

Invest With Bloom Investment Counsel

Bloom Investment Counsel, Inc. is a Toronto-based independent, privately-owned boutique investment management firm with over 38 years of experience, actively managing Canadian and U.S. dividend-paying equity portfolios. Bloom can assist you and/or work with your financial advisors to establish an investment portfolio that best fulfills your specific goals.

Call us at +1-416-861-9941 or email us at info@bloominvestmentcounsel.com for more information.

This content is provided for general informational purposes only and does not constitute financial, investment, tax, legal or accounting advice nor does it constitute an offer or solicitation to buy or sell any securities referred to. Individual circumstances and current events are critical to sound investment planning; anyone wishing to act on this content should consult with his or her financial partner or advisor.