Docstoc

List of mistakes investors make

Document Sample
List of mistakes investors make Powered By Docstoc
					   List of mistakes investors make

   In the rush to be a part of the exciting and profitable world of mutual fund investing, many
   investors make mistakes. It’s human nature and nothing to be ashamed of, but they can and
   should be avoided. Here are a few helpful tips in avoiding the common mistakes that many
   other new investors make.

   First off, a cardinal sin that many new investors make is that they only look at a mutual funds
   previous performance and not at the possible future. Sure, a stock or mutual funds
   performance in the past is a good sign of how its been managed and it always is a good sign
   to surround yourself with people who know what their doing, but you have to take the current
   state of the market into account. For example, funds that may have been heavy on dot.com’s
   did great in 1998 and 1999, but if you had a fund that was heavy in tech stocks in 2000, you
   probably lost your shirt. Past performance doesn’t mean as much as people think it does, and
   you would be wise to not put as much emphasis on it when you go to invest.

   While the percentages listed in the prospectus might seem low, operating expenses for
   mutual funds really do matter. If you’re looking at a fund that might have a higher than
   average percent fee for running the fund, you might want to look at other funds, instead.
   Most market experts think that the percentage of returns over the next few years will be
   down, and so that fee for running the fund takes a bigger and bigger bite out of your profit. It
   may not seem like much, but it can really add up over time, especially if profits are down.

   A small but important part of investing is checking out what your fund manager has on his
   plate. This can be done by checking the prospectus the fund company sent you. Remember, if
   your fund is doing bang up business, it’s likely that the fund manager who is overseeing it is
   going to get more funds to manage or a promotion to look over an entire group of funds. This
   could likely take away from the time he has to look over YOUR fund, and while we wish
   fund managers all the luck in the world in their career, you want someone who is going to be
   focused on making money for you.

   As long as there are people investing in mutual funds, there will be mistakes made. While
   they can’t be avoided completely, a few common sense tips can help you avoid the biggies
   and keep your money working for you.


Accountant Services In London

				
DOCUMENT INFO
Shared By:
Categories:
Tags:
Stats:
views:1
posted:6/30/2011
language:English
pages:1
Services In London Services In London Services In London http://www.inlondonlocal.co.uk/
About Sharing Information And Reviews On Personal Finance, Accounting And Investing