What is hyperinflation – Based on recent comments from Cathie Wood, Musk Jack DorseyWhat is hyperinflation – Based on recent comments from Cathie Wood, Musk Jack Dorsey0 seconds of 1 minute, 34 secondsVolume 0%Press shift question mark to access a list of keyboard shortcutsKeyboard ShortcutsEnabledDisabledPlay/PauseSPACEIncrease Volume↑Decrease Volume↓Seek Forward→Seek Backward←Captions On/OffcFullscreen/Exit FullscreenfMute/UnmutemSeek %0-900:0001:3401:34 My Warning: this article will not be easy to read for most of you. I’m not reciting classic investing mistakes with some generic solutions. I’m attacking the top investing mistakes I’ve seen across the DSR community over the past 8 years. This article covers two of them.
In the following pages, I will not only identify what most investors do wrong, but why they do it and how it hurts their retirement plan. The worst mistakes are often the ones we don’t see. You don’t even realize it’s a mistake since it’s not making you lose money right away. The impact is only visible over a long period of time. It’s like my eternal battle with weight loss.
I’ve been trying to lose weight for several years. It’s a classic resolution most of us make and then forget along the way. The thing is that I don’t forget about it. I even have a plan to make sure I achieve my goal! Over the past 10 years, I’ve made sure to “stay in shape” as I was going through my 30’s. I had been going to the gym regularly until I eventually built one in my basement. I’ve been running 3-4 times a week and even completed a half-marathon. Last year, I ran a total of 836.8km. This year, I’m on target to go above 1,000km! Not bad for a guy who lives in a country where winter lasts 4 months a year! Note: Interested in getting periodic e-mail notifications when articles are published here? Drop your e-mail in the box below!
Do you know how many pounds I lost? None. For all those years, all I have been able to do is to maintain the same weight. I always had a solid training plan and followed it. Nevertheless, my story is like Groundhog Day. Do you know why?
I make the same “invisible mistake” each year.
Sometimes it is called “the weekend”, and sometimes it is “a good glass of wine by the terrace”. But each year, the mistake I make is not about training intensity, the quality of my plan or my diligence. The mistake I make is about eating too much.
You may feel your portfolio is in good shape. In fact, if it is not, it would be quite surprising considering how great the stock market has been to all investors over the past decade. This is the market covering up for your mistakes. Lucky for you, there is still time to solve these issues and get your portfolio on the right track.
I know very well the following investing missteps as I’ve experienced most of them during my investing journey. We usually say that the ultimate result of a mistake is to allow us to learn something. Let’s explore together those errors and learn how you can fix your portfolio using DSR tools. #1 – WAITING FOR A PULLBACK
“ Buy low, sell high” . That is the most basic and sound investing advice we can give to anybody starting their investing journey. Now, what do you do when the stock market keeps going higher and higher? You are not going to buy high (and sell low), are you? This is how you end-up waiting for a pullback. Now that we are currently trading close to an all-time high, it’s even more tempting to wait for the next crash.
Why are you doing this?
History is filled with investing horror stories. During the past 20 years alone, we had the “chance” of running into the tech bubble, the Twin Tower terrorist attack, the 2008 financial crisis, the oil bust in 2015, the 2018 quick bear market, the 2020 pandemic crash and we are about to see how fast this aging bull market might crash. Keeping cash aside for the next crash tells a seducing story: you will buy shares at an incredibly low price, and they will eventually go back up and generate strong returns. After all, why would you buy now, if you can buy later at a cheaper price? Plus, keeping 30% of your money in cash doesn’t make you lose money. It looks like a win-win situation as you get paid (e.g., mediocre interest […]
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