There are all kinds of investors and there are even more investing strategies. There are also just as many possible mistakes you can make as an investor. Those who’ve been in the stock market a long time have likely seen it all. And if they’ve had any kind of sustainable success it’s because they’ve likely learned from those mistakes.
So what about young investors? What kinds of mistakes are they making? According to personal finance expert, Suze Orman, the biggest mistake Millennials make is to invest simply based on what’s hot at the moment. In other words, they go with what’s trendy at the time they’re investing.
She says too many young investors simply decide to invest because “This company is great, I’m going to invest in that.” Orman says that is a very iffy strategy. You might hit it right, but you could just as easily hit it wrong.
Instead Orman prefers investing in ETFs and index funds. She suggests investing a set amount each month into these options. These are a great way for young investors to get into the market. They come with low-risk, and they’re also diversified and inexpensive.
Orman says don’t try to outsmart or time the market. Instead, make consistent contributions to these types of low-risk funds that usually bring stable returns.