If your experience has been anything like mine I’m sure you’ll agree investing in a hot investment tip is a bad idea.
Something I am sure has also cost you a lot of money.
Ignore them like the plague
This has resulted in me ignoring all investment tips like the plague. And what I recommend you do as well.
Read about my experience here
You can read about one of my experiences with an investment tip you can read the article Do you also get investment advice from friends and neighbours
Problem is, we like a good story
The problem with investment tips are… we all like a good story.
And I am not sure why… it could be because of being read to as children or maybe it goes back even further back than that, perhaps it’s in our nature from the times before there were books when history was told in the form of stories.
We can’t be sure, all we know it’s a problem.
But getting back to investing.
You get sucked in
The problem is when someone starts talking about his company doing very well or when a CEO tells a convincing story you get sucked in.
It’s nearly impossible not to listen. I am sure you know the feeling.
My best advice
What I’ve learned through a few painful losses is that you have to learn to ignore stories and investment tips if you want to do well as an investor.
As I explained in the article The best investors have this… Do you? the easiest way for you to become a successful investor is to build your own investment strategy using investment strategies that have proven their value over long periods of time.
And once you’ve determined what strategy suits your personality write it down so it is clear to you and make a note to revise it every year as you learn more.
The most important part
And then (this is the most important part) stick to the strategy through up and down markets because you know that the strategy works (from all the research you have done).
If you do this you will see that investment tips, irrespective of how attractive the story is, have no place in your portfolio because they do not form part of your investment strategy.
This will make hot tips easy to ignore resulting in you having a much better investment performance.
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