FINANCIAL CHRONICLE™
Dear Reader,

Registration with the Sri Lanka FINANCIAL CHRONICLE™️ would enable you to enjoy an array of other services such as Member Rankings, User Groups, Own Posts & Profile, Exclusive Research, Live Chat Box etc..

All information contained in this forum is subject to Disclaimer Notice published.


Thank You
FINANCIAL CHRONICLE™️
www.srilankachronicle.com


Join the forum, it's quick and easy

FINANCIAL CHRONICLE™
Dear Reader,

Registration with the Sri Lanka FINANCIAL CHRONICLE™️ would enable you to enjoy an array of other services such as Member Rankings, User Groups, Own Posts & Profile, Exclusive Research, Live Chat Box etc..

All information contained in this forum is subject to Disclaimer Notice published.


Thank You
FINANCIAL CHRONICLE™️
www.srilankachronicle.com
FINANCIAL CHRONICLE™
Would you like to react to this message? Create an account in a few clicks or log in to continue.
FINANCIAL CHRONICLE™

Encyclopedia of Latest news, reviews, discussions and analysis of stock market and investment opportunities in Sri Lanka

Click Link to get instant AI answers to all business queries.
Click Link to find latest Economic Outlook of Sri Lanka
Click Link to view latest Research and Analysis of the key Sectors and Industries of Sri Lanka
Worried about Paying Taxes? Click Link to find answers to all your Tax related matters
Do you have a legal issues? Find instant answers to all Sri Lanka Legal queries. Click Link
Latest images

Latest topics

» McDonald’s අපේ නෙමෙයි අපේ බෝස්ගේ – අබාන්ස් කියයි
by ChooBoy Today at 10:19 am

» AI Assistance for Stock Market Research and Analysis
by ChatGPT Today at 7:12 am

» Comparative Analysis of the Insurance Sector
by God Father Tue Mar 26, 2024 11:46 pm

» Sri Lanka: Why Pay Exorbitant Taxes?
by ChatGPT Tue Mar 26, 2024 10:52 pm

» LANKA CREDIT AND BUSINESS FINANCE PLC (LCBF.N0000)
by K.R Tue Mar 26, 2024 3:15 pm

» CENTRAL INDUSTRIES PLC (CIND.N0000)
by D.G.Dayaratne Tue Mar 26, 2024 9:11 am

» SIYAPATHA FINANACE PLC (SLFL.N0000)
by ChatGPT Tue Mar 26, 2024 7:58 am

» FINANCE AND LEASING SECTOR
by ChatGPT Mon Mar 25, 2024 6:45 am

» LOLC FINANCE PLC (LOFC.N0000)
by ChatGPT Mon Mar 25, 2024 6:36 am

» CIC HOLDINGS PLC (CIC.N0000)
by ChatGPT Mon Mar 25, 2024 6:18 am

» UNION ASSURANCE PLC (UAL.N0000)
by ChatGPT Mon Mar 25, 2024 6:15 am

» First Capital Holdings PLC: Current Financial performance and future outlook
by God Father Sun Mar 24, 2024 10:58 pm

» LankaBizz: Sri Lanka's First ever Artificially Intelligent (AI) Business and Research Assistant
by God Father Sun Mar 24, 2024 7:27 am

» HOTEL AND TRAVEL SECTOR
by ErangaDS Wed Mar 20, 2024 7:22 am

» CIC Holdings Good Times Ahead
by ashan silva Mon Mar 18, 2024 11:00 am

» EPF Fund keep eye on low P/E Shares
by K.R Mon Mar 18, 2024 8:45 am

» SINS - the Tailwind effects of a crisis hit Economy
by Hawk Eye Mon Mar 18, 2024 8:37 am

» Ceylon cold stores
by Hawk Eye Mon Mar 18, 2024 8:25 am

» Asha securities Provide buy signal for CIC
by ddrperera Fri Mar 15, 2024 1:10 am

» CSE ready for another Downtrend?
by D.G.Dayaratne Thu Mar 14, 2024 11:24 am

» LankaLAW Forum : Sri Lanka’s #1 Discussion Platform for Legal Questions and Answers
by blindhog Thu Mar 14, 2024 9:14 am

» Sri Lanka poised to benefit from demand surge for ‘non-China origin’ graphite
by samaritan Wed Mar 13, 2024 1:31 pm

» LOLC hotels
by Maharaja Tue Mar 12, 2024 2:34 pm

» AEL target price ?
by suku502 Mon Mar 11, 2024 11:26 am

» WAPO 200% UP
by LAMDA Sun Mar 10, 2024 10:33 pm

LISTED COMPANIES

Submit Post
ශ්‍රී ලංකා මූල්‍ය වංශකථාව - සිංහල
Submit Post


CONATCT US


Send your suggestions and comments

* - required fields

Read FINANCIAL CHRONICLE™ Disclaimer



EXPERT CHRONICLE™

ECONOMIC CHRONICLE

GROSS DOMESTIC PRODUCT (GDP)



CHRONICLE™ YouTube

Disclaimer
FINANCIAL CHRONICLE™ Disclaimer

The information contained in this FINANCIAL CHRONICLE™ have been submitted by third parties directly without any verification by us. The information available in this forum is not researched or purported to be complete description of the subject matter referred to herein. We do not under any circumstances whatsoever guarantee the accuracy and completeness information contained herein. FINANCIAL CHRONICLE™ its blogs, forums, domains, subdomains and/or its affiliates and/or its web masters, administrators or moderators shall not in any way be responsible or liable for loss or damage which any person or party may sustain or incur by relying on the contents of this report and acting directly or indirectly in any manner whatsoever. Trading or investing in stocks & commodities is a high risk activity. Any action you choose to take in the markets is totally your own responsibility, FINANCIAL CHRONICLE™ blogs, forums, domains, subdomains and/or its affiliates and/or its web masters, administrators or moderators shall not be liable for any, direct or indirect, consequential or incidental damages or loss arising out of the use of this information. The information on this website is neither an offer to sell nor solicitation to buy any of the securities mentioned herein. The writers may or may not be trading in the securities mentioned.

Further the writers and users shall not induce or attempt to induce another person to trade in securities using this platform (a) by making or publishing any statement or by making any forecast that he knows to be misleading, false or deceptive; (b) by any dishonest concealment of material facts; (c) by the reckless making or publishing, dishonestly or otherwise of any statement or forecast that is misleading, false or deceptive; or (d) by recording or storing in, or by means of, any mechanical, electronic or other device, information that he knows to be false or misleading in a material particular. Any action writers and users take in respect of (a),(b),(c) and (d) above shall be their own responsibility, FINANCIAL CHRONICLE™ its blogs, forums, domains, subdomains and/or its affiliates and/or its web masters, administrators or moderators shall not be liable for any, direct or indirect, consequential or incidental violation of securities laws of any country, damages or loss arising out of the use of this information.


AI Live Chat

You are not connected. Please login or register

The Biggest Mistake An Investor Can Make

+2
Trillionaire
sriranga
6 posters

Go down  Message [Page 1 of 1]

1The Biggest Mistake An Investor Can Make Empty The Biggest Mistake An Investor Can Make Wed Feb 22, 2012 8:15 pm

sriranga

sriranga
Co-Admin

This is the worst mistake you're probably making -- and here's how to fix it.

You're probably making the worst mistake an investor can make. I know I am. And after the bull run we've been enjoying, that mistake probably got a lot worse.

The French author André Maurois once said: "Everything that is in agreement with our personal desires seems true. Everything that is not puts us into a rage."

That's the mistake. "Rage" may be far too strong a word for most of us. But you'll see plenty rage around the investment discussion forums on the web -- particularly when someone presents a sensible bear case for an individual stock.

Maurois also said: "We appreciate frankness from those who like us. Frankness from others is called insolence." And therein lies the key to overcoming this mistake.

One big mistake -- lots of names
The mistake is in deciding that an investment is great for whatever reasons, then closing oneself off to alternative viewpoints. Some call it "falling in love" with a share, whilst the behavioural economists refer to it as confirmation bias; is the tendency of people to favour information that confirms their beliefs or hypotheses.

It's closely related to other ways to lose money on shares such as anchoring, overconfidence and availability bias (the tendency to give undue weight to more prominent facts).

I'd say it's also related to what Peter Lynch describes as the greatest single fallacy of investing; the feeling of being "right" when your shares have risen.

"If I had to choose a great single fallacy of investing, it's believing that when a stock's price goes up, then you've made a good investment," says Lynch.

In short, we really want to be right -- and we really don't give fair weight to the opposing viewpoints. And if anyone but a friend presents the opposing viewpoint to us, we don't like it one bit. It's an innate part of our psychology. But it's still a mistake.

How to beat it
So how do you overcome it?

Undoubtedly the most difficult thing is to set aside one's emotions. This is easy to say but harder to do. But if we can gather facts in an impartial and objective way, and weigh them well; then it has to be a good thing for investing.

There are a few useful tactics you can use to achieve this:
* One is to pretend you're collecting the bullish and bearish points to present to other people to let them decide for themselves in a balanced way.

* Another is to explain to a true friend who understands a little about the market why you think as you do -- and to let him/her punch a few holes in your case.

* A third way is to try to present only the opposite side of the case -- as would a barrister, for example, in trying to paint an opposing picture. It's surprising how often this one cools your ardour.

* And finally -- do try the discussion boards with your reasoned analysis, but promise you'll be without "rage" whatever flak your ideas attract.


Do something
But eventually there comes a time to act. When you've done all the analysis you can, and weighed the pros and cons; then act on your information. Dither no longer. Either buy, sell, or walk away without regret whatever happens next.

You decided what you decided in the best and most objective way you could with as much factual information at your disposal as you could muster. That's it. Que sera, sera. There's a time to act and not to look back.

If you're proven to have been right -- great. But judge your decisions on a reasonable timescale and don't be fooled into thinking you were right by virtue of macro market direction alone.

Short-term fluctuations mean nothing. If you were wrong and are looking at the same investment again down the line -- then it's a new day.

What was done, was done. So the process needs to be repeated in light of new evidence or at least a revised valuation.

BY David Holding
http://www.fool.co.uk/news/investing/2012/02/22/the-biggest-mistake-an-investor-can-make.aspx

http://sharemarket-srilanka.blogspot.co.uk/

Trillionaire

Trillionaire
Manager - Equity Analytics
Manager - Equity Analytics

That's true! Thanks for sharing! Smile

dilshan

dilshan
Senior Equity Analytic
Senior Equity Analytic

~ Thanks a lot for sharing Smile ~

sas

sas
Senior Manager - Equity Analytics
Senior Manager - Equity Analytics

BIG thanks as always sri... great stuff Smile

Light of Hope


Vice President - Equity Analytics
Vice President - Equity Analytics

thanks for sharing

CSE.SAS

CSE.SAS
Global Moderator

Thanks for sharing as usual good one.

Sponsored content



Back to top  Message [Page 1 of 1]

Permissions in this forum:
You cannot reply to topics in this forum