If you’ve ever purchased a house, car, or home appliance, you likely have done your homework by researching the product before committing a significant amount of your hard-earned money. The same rules should apply before entrusting your money to a stockbroker, purchasing securities, or making any kind of financial investment. Before you invest, you should consult with a qualified professional and try to ask as many questions as possible. First, use FINRA’s BrokerCheck system online to learn if the potential stockbroker has a disciplinary or customer-compliant history. Even if you consider yourself a savvy investor and have plenty of experience with stocks, bonds, and the like, there are a number of investment “blind spots” that can keep you from reaching your potential. Below are a few investment tips to always be mindful of before investing:
Be Thorough
Always pay attention to your investment – one easily avoidable mistake is failing to monitor and assess your investments, because markets can – and will – change. Make sure to periodically review your account and your strategy to make sure it remains consistent with your risk tolerance and investment objectives.
Remember Your Limitations
Be careful not to be overly optimistic about your abilities. Even confident and successful investors and securities brokers will consult others instead of relying on their own judgment.
Be Patient
If you’re constantly trading, you will need to generate enough investment returns to cover your transaction costs before you see any profits from your investments. The more transactions, the more costs and commissions you likely will have to pay. In fact, low turnover (i.e., few trades) is more closely linked to higher returns than high turnover. Finally, be wary of bias – i.e. holding on to a stock for too long because of attachment.
Have a Clear Goal in Mind
Last, but certainly not least, have a goal and stick to it. Make sure your investment strategy aligns with your goal, and try not to deviate from it.
Call a Los Angeles Investment Attorney Today
Make sure to keep these concepts in mind when investing. If you experienced investment losses due to the bad advice or fraud of a broker, you may have certain legal rights that require your immediate attention. Contact an experienced Los Angeles investment attorney today for a consultation today.