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Section 5

Short Term Focus – Monitoring

Investments Daily

What Should I Do Today About My

Investments?

A major reason that investors don’t do well is the tendency to
focus on what’s happening in the stock market, or what’s in the

news, this month, this week, this day, even this hour. Because
all of the information in the world is now available everywhere,

all the time, we are bombarded with reports throughout the
day. The effect of this information overload is a tendency for

these messages to make investors focus on the short term.

Even though investors may say they have a long-term

investment horizon, they become focused on what to do
today. They become overly sensitive to volatility in the markets,

regardless of their investment time frame. They become
focused on short- term instead of long-term risk. This leads to

poor, many times impulsive, investment decisions, which really
amounts to gambling rather than investing. Most investors say

Chapter 4: The Most Common Investor Mistakes