Share Market

There are a lot of unrealistic and outright wrong beliefs that float the stock market. The rumors or preconceived stock market myths can be of both the harmful and harmless nature. As an investor and trader it’s important to steer clear of these and have an active involvement within the market. Some of the very common stock market myths:

1. When Someone Makes Money, Someone Else Loses It. It is believed that the stock market is a zero sum game. So, when one loses money, one gains it. Thus believing that stock market is never in a money growing position. The truth is very different from this. All long term investors earn money as long as the stock market is constantly going higher. It’s only in the case of an immediate short term that the stock market be considered a zero-sum game, where one investor’s loss is another investor’s gain.

2. Buy And Hold Is The Best Strategy. It is believed that the best way to grow your money is to find stocks that you like and to sit on them for as long as possible. Due to stock market’s unstable nature, it is better to wait for the stocks to rise. However, the truth of the matter is that although this stood true till many years ago, it has failed to stand true today. It is in fact a very poor strategy.

3. You Can’t Beat The Stock Market. It is widely believed that the stock market cannot be beaten at its own game. A good performance at the market is according to the market’s nature and those who have been very lucky with the profits will not have their luck last for long. It’s believed that the market cannot be outsmarted and that every investor must just accept that. In reality, the truth is that the stock market can be beaten in terms of performance. There is no stock market as unbeatable. Investors and traders do it every year, and some even do it every year consistently. Beating the stock market is not everyone’s forte but it very much attainable. You have to manage your portfolios, take an active part and be vigilant. Most investors and traders don’t focus on the stock market and then crib about this being the nature of stock market. This is why the myth refuses to die.