If you talk about investing with a friend, you can be greeted with an answer like: “You could lose money in the stock market.”.
True, they are not wrong. You could lose money in the stock market. But you would be surprised how often you earn by investing in the stock market.
Similarly, other myths about investing can prevent you from creating a portfolio is good for you.
X is the best investment
You can replace the X with gold, property or shares of any company of the moment, such as Google.
As Warren Buffett says, do not put all the eggs in one basket. Despite everything, it is important to remember that investing in an asset can be as risky as betting.
Getting rich quickly is not investing, it is speculative and can increase the chances of losing money.
There are some individuals who do very well by buying a winning stock but it is difficult to maintain this strategy in the long run.
You only lose money in the stock market
The problem with this statement is that it can be true, but only if you don’t do your research, that is, if you don’t know a full amount about your investment options.
Index funds allow you to invest in the stock market by distributing risk, so you don’t have to put all your eggs in one basket.
In addition, some of the commissions are lower.
You have to pay more in taxes to get good returns
Expensive is not synonymous with quality. Like anything you buy, a higher price does not guarantee a higher return on your purchase.
Sometimes it’s worth paying a little extra to buy something that seems to be made of a higher quality material, but with the investment, a higher fee doesn’t mean you’ll get a strong return.
One of the ways in which investors can reduce their returns is by paying a high commission calculated as a percentage of their entire portfolio, which means that there is no upper limit on how much they could pay to a broker.
As an investor, you can “buy” investments only by going through a broker, such as a person or company that has access to the market.
The broker will charge you a commission for using their service. As with a bank, when you invest through a company, you can open an account with them, thanks to which you buy your investments.
The brokerage firm can charge a fee each time you purchase an investment and an annual fee for using their account service.