Many new investors enter stock market with passion and intuition. Unfortunately, they run into some bad investing habits. Normally, there are the following types of investors:

The first type of investor are too hurry to make decisions and is irrational. When some investors find that the bull market is going to come and the market index is going to go up, they will buy lots of stocks worrying about missing the chances to gain profit. Therefore, here come the problems they buy stocks wrongly and enter the market at the wrong time. Sometimes, they even buy strong stocks at the top of their prices making it hard to gain profit from them.

This type of investors should choose the best time to enter the market with limited capital. Do not pursue unlimited chances with limited money.

The second type of person likes to follow most investors to buy stocks. Those investors are constrained by habits. When the market goes up, they will think there is a chance to go up to 6000 points. They buy stocks after the market has gone up because they see the prices going up. They are hurrying to sell stocks when the prices go down because the prices are declining.

This type of invesetor should pay attention to favorable factors in a bear market and unfavorable factors in a bull market.

The third type of person feels difficult to sell stocks they own even if the prices begin to go down. It’s true that investors easily gain great profit from a bull market but it depends on what stocks they have. Many investors hold stocks in a bear market. These stocks normally are not popular in the current market. Naturally, they find it difficult in getting out of trouble.

This type of investors should know that although it adds tax cost to change stocks frequently. the increasing ratio of strong stocks is several times bigger than those of weak ones.

The fourth type of investor like following fund managers. This type of investor is not a lot but they operate in the way that funds do, having dozens of stocks in one account. Although they buy stocks of a great variety of sectors, industries, and companies, they earn little. Although they choose two leading stocks but hardly gain more profit because they just bought a few. Besides, they fail to see the whole picture because of having too many stocks. They know nothing about the basic facts of the company which means they can not control the money in the volatility of the prices.

This type of investors should Clean their accounts and keep the most valuable stocks.

The fifth type of investor is prone to think in a bear market. After going through the several-year bear market, many investors form a mindset of the bear market. They usually earn a little profit then sell the stocks then predict that the prices will go down. The prices keep going up, leaving their profit behind.

This type of investors should clear their minds and have more positive ideas.

（Writer：Matti）