The biggest investment enemy is the one we face in the mirror.
Our fear, greed (and sometimes a delusional sense that we can somehow see the future) affect solid investment plans. But smart investing has just three simple rules:
- Build a diversified portfolio of low-cost index funds.
- Rebalance once a year.
- Never speculate–and don’t let anyone speculate on your behalf.
That’s it. Follow these simple rules and, over your lifetime, you’ll beat the pants off most professional investors, after fees.
But there’s a pesky little devil that likes to tempt us all. It wants us to gamble, to guess the market’s direction. It wants us to dance in the stock market casino.
Such temptations sometimes hit us when we’re making trading orders. We’re left with a choice.
Should we place a market order or a limit order?
Images by Pixabay
