Stock Stories 8 Mistakes of Beginner Investors - What I Wish I Knew When I Started Investing
These are some thoughts about what I wish I had known when I started investing. I could have paid more attention to these lessons and saved a lot of money. Because I made some of these mistakes, I am STILL paying for it in my portfolio. I don’t want you to go through what I went through.
I'd like to give a special shout out to some of my fellow investors out there who contributed their thoughts to this episode:
Harvir - @millenial_mogul_investing
Mabel - @girlsonthemoney (check out our interview in Episode 96)
Teri - @imaninvestor (check out our interview in Episode 91)
Hari and Beko - @valueinvestortv
The 8 mistakes, and their accompanying mental models are:
- Lack of Basic Financial Literacy (and lack of Mental Models as a general concept)
- Buying A Stock Because You Like the Product or Service (Endowment Effect)
- Placing Emphasis on Price, Not Value (Mere Exposure Effect)
- Placing Emphasis On Recent Stock Performance (Recency Bias, Scarcity)
- Failing to Recognize Cyclical Businesses and Business Cycles (Dunning-Kruger Effect)
- Lack of Patience With Capital Allocation (Action Bias)
- Overestimating or Underestimating a Business’ Competitive Advantage(s) (Mental Model: Confirmation, Mr. Market, Inversion)
- Outsourcing Your Thinking To Others (Mental Model: Availability Heuristic, First Principles Thinking)
Other episodes mentioned include:
Episode 4 - The Six Categories of Stocks
Episode 10 - Mental Model: Inversion
Episode 15 - Mental Model: Circle of Competence
Episode 26 - Mental Model: First Principles
Send me a direct message on Instagram with any comments, suggestions, or just to say hi @stockstoryteller. Or, you can email me at alex@stockstoriespodcast.com
Email: alex@stockstoriespodcast.com