Topic: How To Invest

What is Pat’s commentary for the week of April 19, 2016

Article Excerpt

You have to learn a lot of things to become a successful investor, and few people learn them all in any logical progression. Instead, most of us move from one subject of interest to another, with a lot of zigs and zags in between. That’s why some investors go through a phase when they know just enough about a particular investment to be a danger to themselves and others. All investments come with a mix of risk and potential reward. The greatest danger comes when you understand the mechanics of an investment, but you’re missing some of the details. Your understanding of the potential reward can make you greedy, while the gaps in your knowledge limit your natural, healthy sense of skepticism. Promoters of speculative systems exploit this all-too-human failing in their advertising. Take, for example, foreign-exchange trading courses, for which you can pay hundreds or thousands of dollars for a day or two of instruction. The marketing materials for these courses…

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