Investment Tips That Lead New Investors Astray

Investing pic
Investing
Image: instphil.org

Arthur J. Samberg graduated from Columbia Business School in 1967. Appreciative of his time there, Art Samberg has donated over $35 million to help the school create new programs. Presently, Art Samberg is the owner of Hawkes Financial, LLC, his family office. He founded his first fund in 1986.

Neophyte investors tend to get the same advice, which amounts to investing safely. But certain investments only appear safe. For instance, experts tell beginners to invest in well-run growth companies, but small-cap and value companies stand a better chance of producing higher gains. High-quality growth companies are popular because they are known, which means they cost significantly more to acquire than small-cap and value companies, putting them out of reach for the majority of new investors.

Another long-standing belief in investing is that holding an investment for longer periods of time results in increasingly greater odds of success. The opposite is, in fact, true. The longer an investor holds onto a company or diversified portfolio, the higher the chance of a catastrophic event that ruins the investment. Some investors are too stubborn to let go on an investment and will let it ruin them.

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