Some Reasons Why You Might be Bad at Investing

Aug 24, 2016 | Blog, Investing

Nobody’s perfect, and this is a truism when it comes to investing. In fact, studies show that even the majority of money managers are unable to beat indexes like the S&P 500.

With that in mind, consider these reasons that could be tripping you up and throwing off your investing game plan:

You’re lacking discipline

Just as important as your investment choices is how you react to their performance. For instance, say you’re investing for retirement, and there is a stock market downturn. Your asset allocation and investment portfolio will be for naught if you’re tempted to forgo your long-term strategy and sell your stocks. Essentially, if you react to market events, you might be bad at investing because you’re often selling at a low and buying back in at a high.

You’re overconfident

On the opposite end of the spectrum, hubris might be one of the reasons you’re bad at investing. Numerous studies show that most of us rate ourselves as better than average at many skills, so this investing syndrome is very common.

When you’re overconfident, you might also detract from your goals when your investments are doing well. You’ll be led to think you’re an investing guru who can accurately pick successful investments with ease (when in reality, concentrating your investments is equivalent to throwing a dart blindfolded to choose a winner).

Utilizing a financial advisor if you might be bad at investing   

At LexION Capital, we help our clients avoid investing mistakes by crafting portfolios that they can stick with for the long-term based on their unique risk tolerances and needs. We can serve as your coach and advisor to help you turn your investing dreams into realities. To start a conversation and find out more, reach out to us today.

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