It takes many great stock picks to make up for just a few big errors, says Pat Dorsey, author of The Five Rules for Successful Stock Investing. So even before one goes into any analysis process, care should be taken to avoid seven easily avoidable mistakes.
Here is Pat Dorsey’s list of seven mistakes to avoid:
1. Swinging for the fences.
2. Believing that it is different this time.
3. Falling in love with products.
4. Panicking when the market is down.
5. Trying to time the market.
6. Ignoring valuation.
7. Relying on earnings for the whole story.