Admit it . . . you're not perfect. Still, it would be nice to learn from someone else's mistakes for a change, or at least avoid making the same mistakes twice. With that in mind, here are some of the most common mistakes made by astute (and some not-so-astute) investors. Feel free to tally up how many you've made. If you tick off fewer than two, consider yourself a pro; three to five, you're an expert; six to eight, you need some help; more than eight, don't just sit there . . . rethink your actions! Read on to see how you fare.
Love me, love my stock. Everyone's heard the one about the stock inherited from grandma that began as a few measly shares and, through dividend reinvestment (and divine neglect), is now worth hundreds of thousands of dollars. The stock shares are like the Energizer bunny . . . they just keep going and going, and presumably they always will. Or will they?
Whether you're holding shares of a tobacco company, a soft-drink purveyor or a software developer, perhaps you should consider selling off a few of those wonderful shares and diversifying your portfolio a bit. (Before you do, however, be sure to check with your tax advisor.)
See our tips on Thursday, December 28 through Thursday, January 4 for parts 2 through 7 of this article.