The Synopsis Dialogue. Learning from 8 Common Mistakes Professional Investors Make (and What to Do Instead)
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Jan 8, 2026 Drew Cohen, a financial writer and creator of the Five Minute Money newsletter, shares his insights on common pitfalls in investing. He discusses eight key mistakes, including the dangers of position sizing and the importance of trusting your intuition. Drew emphasizes the risk of borrowing conviction from analysts and cautions against selling great businesses too soon. He also reflects on how bias can cloud judgment, urging listeners to reassess popular stocks, especially after declines. Tune in for practical strategies to enhance your investment approach!
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Reverse-Engineer Position Size
- Decide your maximum position size up front and the price at which you'll reach it.
- Stop buying once the stock falls below that price to avoid oversized allocations.
Price Drops Often Signal Rising Risk
- Stocks that fall a lot usually reflect increased business risk, not random noise.
- Reevaluate the thesis instead of reflexively dollar-cost averaging down.
Reset Your View On Troubled Positions
- Pause and approach a troubled holding from a mental blank slate to reassess facts.
- Consider selling completely and testing if you'd willingly buy it back to reveal true conviction.