investing

5 key tips for self-directed investors

No. 2: Avoid trading on emotions
No. 2: Avoid trading on emotions © baranq/Shutterstock.com

Many self-directed investors approach stock investing like an infatuated teenager. They fall in love with gold stocks one week, and then gravitate to tech stocks the next, energy stocks the following week, and so on. "Investing on emotion destroys returns. People buy high and sell low," Schatz says. The goal is to do the opposite.

Fear and greed undermine the goals of investors. When fear drove investors to abandon the equity markets during the financial crisis, they missed the opportunity to benefit when the markets eventually rebounded.

Establishing a plan is tricky, but maintaining it through perilous times is doubly difficult. The key to sustaining it is by being clear about what you are trying to accomplish, determining your risk tolerance and setting a time horizon, Schatz says.

advertisement

          Connect with us
advertisement
CD & INVESTING NEWSLETTER

Learn the latest trends that will help grow your portfolio, plus tips on investing strategies. Delivered weekly.

CDs and Investment

How do I repay IRA loan?

Dear Dr. Don, Hello, I read your column about short-term, 60-day loans from an individual retirement account. How do you withdraw funds from an IRA? Can a person redeposit the funds back into the same IRA? Or can the money... Read more

advertisement

Blog

Sheyna Steiner

The King may defect to Canada

Burger King is in talks to buy Tim Hortons and will likely join the list of corporate expats. What does the tax inversion strategy mean for investors?  ... Read more

Partner Center
advertisement

Connect with us