Common stock market mistakes that new investors should avoid to protect their investments

Lack of Research: Investing without understanding a company’s fundamentals, such as its business model, financial health, and market position, can lead to poor decisions. Thorough research is essential to make informed choices.

Emotional Investing: Making decisions based on fear or greed, especially during market volatility, can result in buying high and selling low, undermining long-term goals. Staying disciplined and sticking to a strategy is key.

Overtrading: Frequent buying and selling, often driven by short-term market fluctuations, can erode returns due to transaction costs and taxes. A long-term, buy-and-hold approach is generally more effective.

Ignoring Diversification: Putting all money into a single stock or sector increases risk. Diversifying across different industries and asset classes helps mitigate potential losses.

Chasing Trends: Jumping into hyped-up stocks or sectors without due diligence, often fueled by media or social media buzz, can lead to investments in overvalued or unstable assets. Investors should focus on value and fundamentals instead.