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Anonymous

Posted on 07 Oct 2020

What are some of the most common financial mistakes that you see investors do and would like to let them know if you could?

I'm sure you've seen many investors make some common mistakes, what are they and what kind of advice would you give so they an avoid making them?

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Discussion (1)

Hi Anonymous,

Thanks for your question. A few areas of concern come to mind:

  1. Thinking that experts can beat the market through market timing or a superior reading of macro or economics or industry analysis.

  2. Not staying invested, but trying to move in and out, thus turning a paper short-term decline into a permanent loss

  3. A home bias towards Singapore, thus being non-diversified

  4. Following the lastest fads.

  5. Seeking to maximise returns rather than seeking sufficient and reliable returns that safeguard's ones larger financial and life goals.

  6. Not paying attention to Total Expense Ratios and/or hidden costs (e.g. in ETFs)

I think a lot of this stems from not understanding markets and not putting investing in the context of a larger financial plan.

MoneyOwl hopes to help everyone get started on understanding this and investing in a way that is holistic, sustainable, reliable and without guessing, capturing long-term market return. You can read more of our investing philosophy here at https://www.moneyowl.com.sg/the-right-way-to-invest/

Thanks for allowing me to share these thoughts!

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