People always seem like they have a lot of things to say when it comes to investments and oftentimes, their statements are baseless. However, it doesn’t stop it from hurting the performance of your portfolio. Check out our list of the most popular myths about investments below and see the truth behind it!
You can predict the market
This is a common misconception and a lot of people, even the pros, are not safe from making this assumption. The market would always remain unpredictable and that is a fact. You can never be certain where the fluctuations would take you, but there are some points that you can use to place the right investments and that is by reading the history of trends and the interest of the people. Find out what keeps them hooked and what would we need with how things are going right now.
Only the pros would have an edge
The market is an even ground for investors. The only time you would earn differently from other investors is if they have huge shares or investments. But in terms of advantage, the market doesn’t favour anyone. Even as a beginner you can strike gold in the stock market. The reason why people think that pros are the only ones with the edge is that these professionals already have experience and they know what they are doing. Perhaps with a little bit of guidance and experience, you would have this edge as well.
The market is a casino
From the perspective of an outsider, the United States Wall Street might seem like a casino. It is an understandable misconception since investments are pretty much a gamble. However, what makes it different is that you don’t rely on luck in your investment. You need a strategy and by planning carefully, you can establish a huge return for your investments.
The only way to make money in stocks is by buying low and selling high
While you can earn high returns by following this concept. It is not the only way for you to earn money in your investment. It is observed that buying high and selling higher is a more effective way of investing since a stock tends to generate a higher return when it is overvalued. If you wait for the stock to get cheaper you might miss out on the bullish market.
You need to switch to bonds when you retire
This one might have been true before, but the financial market has advanced and therefore it is no longer up to date. Now, if you treat bonds as passive income, you would need a large portfolio to sustain your lifestyle. By spending all your bond income as a passive source of money, you will lose the benefit of your compound interest.
Have you heard about these misconceptions as well while you are planning your investment? Well, now the truth is out so there is no need for you to fear any possibility for your investment account.
Use the facts that you’ve learned here on your investment and be sure to follow some of the tips that you’ve known before. For better investment strategies and planning, contact us at EquityplusDB. We have a group of professionals who are experts in the best investments in the United States.