15 Common Mistakes Most Investors Make

15 Common Mistakes Most Investors Make

1. Most investors never get past the starting gate because they do not use good selection criteria. They do not know what to look for to find a successful stock. Therefore, they buy fourth-rate "nothing-towrite- home-about" stocks that are riot acting particularly well in the
marketplace and are not real market leaders.

2. A good way to ensure miserable results is to buy on the way down in price; a declining stock seems a real bargain because it's cheaper than it was a few months earlier.

\Is Your Stock in the Top Half of Its Own Group?

\Is Your Stock in the Top Half of Its Own Group?

The institutional service arranges companies within an industry in order of their current week's computerized Datagraph rating. Quality stocks in the top half of their own group are better investments in almost all cases than are stocks in the bottom half of the same group.

Because every graph measures the same crucial investment factors on a comparable basis, a manager or analyst can quickly screen every alternative in a group by comparing 120 basic factors of one stock to another. In 15 minutes, an experienced professional can pinpoint the two or three equities in a group which appear worthy of further fundamental research. The remaining stocks that do not measure up should be eliminated from additional consideration.

Industries of the Future or Past?

Industries of the Future or Past?

There will be many new subgroups in the future, imaginative applications most of us haven't thought of yet. As this endless stream of ingenious offshoots of the original mainframe industry multiply every year or two, exciting new subgroups to monitor will be added to our database.
Change and new technology are occurring in the United States at an accelerating pace. Automation is also the way we keep track of it.

After all, we are in the computer, communications, and space age. New inventions and technologies will spawn thousands of new and superior products and services. Space research should be promoted.

Industries of the future can create gigantic opportunities for everyone. Industries of the past, while at times quite interesting, may present less dazzling possibilities.

Here are a few older industries whose greatest growth was possibly in the past (unless, of course, major changes occur).
1. Steel
2. Copper
3. Aluminum
4. Gold
5. Silver
6. Oil
7. Textile
»
8. Chemical
9. Paper
10. Railroad
11. Railroad equipment
12. Utilities
13. Tobacco
14. Airlines
15. Old-line department stores

Industries of the future might include:
1. Computer, computer-related services, and software
2. Laser
3. Electronics
4. Communications
5. New concepts in retailing
6. Space exploration and research
7. Medical and drug
8. Special services

How to Utilize the News Pages in a Bear Market

How to Utilize the News Pages in a Bear Market

Below is a list of ideas that should be helpful in a declining market:

1. Are more corporate earnings reports coming in below estimates?
2. Use the new low list in conjunction with the stock tables to show a stock's % change in volume when it makes a new price low.
3. Check the 90 minigraphs of "Stocks in the News". There will be fewer stocks making new highs and more showing huge increases in volume. Those closing down in price might be selling situations in a bear market, especially if they are not extended too far below price-basing patterns.
4. Notice if there is a shift to defensive securities such as Foods, Supermarkets, Gold, Tobacco, or Utilities. See if many defensive group graphs show up in Friday's newspaper at the bottom of the general market indicators page.
5. What are the weakest industry groups and the former leading groups?
6. Are more stocks consistently underlined in the price tables than are boldfaced?
7. Monitor quarterly earnings reports daily to spot poor reports in stock positions that may need to be sold.
8. Check price tables for companies with relative strength breaking below 70 and Volume % Change up when price is down.
9. Study the daily market averages on the general market indicators page to determine bad market conditions as well as the eventual beginning of the next bull market. Observe the Mutual Fund Index and performance of foreign market averages for further clues. Is
the Fund Index persistently below its 200-day moving average line?
10. Watch for special news items daily on companies, industries, or the economy. And be sure to check the NASDAQ chart.
11. Track weakening stocks that perhaps should be sold.
12. Which sector indexes are the weakest?
13. Save and study the New America page to get ready for the next bull
market.

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Be Alert to Stocks with the Greatest % Change in Volume

Be Alert to Stocks with the Greatest % Change in Volume

All newspapers show the 15 most active stocks, usually consisting of securities like IBM, AT&T, or General Motors, which each normally trade more than a million shares a day. Investor's Business Daily, on the other hand, shows a table of the "Common Stocks with the Greatest % Rise in Volume." This spotlights companies that have the largest increase above their own last 50 days of average daily trading volume.

The list is valuable because the computer surveillance picks up the small- and medium-sized, innovative, entrepreneurial organizations that may have a 500% increase in trading volume but never reach a total volume figure large enough to make the more commonly followed "Most
Active" lists. These sophisticated screens may not appear in other publications. Pay close attention to the boldfaced stocks on the list.

Some newspapers list the stocks that are up most, percentagewise, in price. This list is almost universally worthless because it will show a $2 stock up /s of a point as stock up in price the greatest percent. They also show preferred stocks in the list. Low-priced stocks and preferred
issues are of little use to most informed investors. You can't get rich prospecting in the junk pile.

Eliminating the cheaper, less relevant, low-quality stocks, plus the preferred issues, and concentrating on a meaningful list of 25 of the more significant securities or higher is more useful. Stocks in this list that have options listed show a small "o" after the company's name
to assist option traders.

Most newspapers typically provide a small block, "How to Read the Daily Stock Tables." Be absolutely sure to read these instructions as you would directions to any new product you buy. You'll learn many helpful facts that will save you money.

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The Five Dumbest Mistakes Mutual Fund Investors Can Make

The Five Dumbest Mistakes Mutual Fund Investors Can Make

1. Failing to sit tight for an absolute minimum of 10 to 15 years.
2. Worrying about a fund's management fee, turnover rate, or dividends
paid.
3. Being affected by news in the market when you're supposed to be
investing for the long pull.
4. Selling out during bad markets.
5. Being impatient and losing confidence too soon.

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Why Many People Lose Money in Top-Performing Funds

Why Many People Lose Money in Top-Performing Funds

Believe it or not, half of the people invested in some of the best-performing funds in the country may lose money. How can that happen? Very few people buy during a bear market.

Are Monthly Investment Plans for You?

Are Monthly Investment Plans for You?

I do not generally favor monthly investment plans, where an investor adds Rs 5000 or so every month to a fund program. My reason is practical. Most people do not stick with them religiously. Therefore, they delude themselves by thinking they are going to achieve substantive long-term goals with such plans. If, on the other hand, you can have money automatically .

Checking Management Fees and Turnover Rates

Checking Management Fees and Turnover Rates

Some investors try to evaluate the management fees and portfolio turnover rate of a fund. In most cases this nit-picking is not necessary.

In my experience, some of the best-performing growth funds have higher turnover rates. The Fidelity Magellan Fund, during its three biggest performance years, averaged an annual turnover rate of over 350%.

Should You Buy a Global or International Fund?

Should You Buy a Global or International Fund?

Yes, these could be a sound investment and provide further diversification, but I would definitely limit the percent of your total fund investment investments. International funds can, after a period of good performance, suffer several years of laggard poor performance.

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