|What type of “odometer” can you use to check your financial progress? Look at the longer-term information on your investment statements. By seeing how a specific investment has fared over several years, you can get a sense of its performance, although an investment’s history is not always a guide to its future results.
Another measurement to watch is the difference in your portfolio’s total value from one year to the next. By looking at these long-term measurements, you can evaluate the progress you’re making toward your key goals and what steps you can take to make your trip even smoother.
Buy High and Sell Low: Formula for Failure
Fear and greed may not always drive the market but these emotions do drive the behavior of many investors. And the results are usually not good.
Let’s start with the “fear” element. The fear of losing money causes many people to sell stocks when the price has fallen. Supposedly, this action helps these investors “cut their losses.” However, they may be selling high-quality stocks with good prospects.
As for greed, too many of us chase after “hot” stocks but by the time we buy these stocks, they already may have cooled off.
Invest with your head not your heart. Before buying or selling stocks, learn everything you can about them. Do they represent companies with competitive products, strong earning and good management? And are these stocks suitable for your needs?
Ultimately, the more you know, the less tempted you’ll be to “buy high and sell low.”
Contact Wendell at Edward Jones www.edwardjones.com.