Mistake made by the Investors – Past Performance

The single greatest mistake investors make is to extrapolate recent history out into the future. They take the financialblog returns of the past 5 days or 5 years or even 50 years and assume the next few days or years will look just the same without any consideration for the historical context or conditions that provided for those returns.

They forget that, while ‘history may rhyme, it doesn’t repeat itself’ (Twain). Or that, “the only thing that is constant is change” (Heraclitus). These two famous quotes apply to the financial markets as much as anything.

Ignoring these truths and instead simply extrapolating is why investors are suckered into pouring money into the stock market only after a run of great performance. Continue reading “Mistake made by the Investors – Past Performance”

How Misselling is done -Investors Trap

There are so many products in this global financial market that sometimes a financial advisor feel more like a bouncer thanblog anything else……..Sharing some of the pitches been made in the past and the on-going practices,

  • Oil and Gas Limited partnerships. (If you being cut in on them, the wells are dry.)
  • Principal protection funds. ( They are always come out after the market’s been killed and cap your upside on the recovery)
  • Insurance broker selling asset management. (Does your hair – dresser also repair the roof on your house?)
  • Stock broker selling guaranteed – return equity linked annuities. ( Yeah that’s end well) Continue reading “How Misselling is done -Investors Trap”