5 Myths About Investing and The Stock Market
Here are 5 myths about investing in the stock market explained. The insights in this post will change a traditional view on investing, trading stocks or ETFs and about how the stock market works. Myth #1: The way to forecast if a stock is a good buy is by studying the graph. Behind door number one is one of the most common myths I see today. Many people will look at the stock’s price graph and if it’s been going steadily up over a period, they will buy the stock. The belief is that the past price and upward trend on the graph indicates success and that the stock is likely to continue trailing upwards. But the past doesn’t equal the future and the price of the stock is not equal to value of the business behind the stock. If you’re currently buying stocks this way, a good way to make a small change is to add in a few steps before you buy the stock: Check the company behind the stock. Is it profitable or reporting a loss? Does the company have debt? And does the management have integrit