What are the don'ts in investment?

There are some practices that you should avoid when making investment decisions to minimise the risk of making a loss:
  • DO NOT borrow to invest. You should not take other people's money to invest or take out cash from your credit card. If you do not have money, do not invest

  • DO NOT invest just to get quick and high return. Quick returns always carry high risks. Always be cautious of illegal get-rich-quick-schemes that promise quick money for your investments. They make false promises and may run away with your money

  • DO NOT invest in high-risk investments unless you are ready for it. Some investments involve a high degree of speculation and risk (e.g. futures trading)

  • DO NOT invest on the basis of 'hot' tips and rumours

One should not enter into any investment decision in a hasty manner.

A smart investor must proactively seek information on the various investment options available. He or she must also be sensitive to the prevailing investment climate and market conditions.

Investors must always remember to exercise prudence when it comes to making an investment choice and decision.

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Reprinted with permission from BankingInfo (A Consumer Education Programme by Bank Negara Malaysia)

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Knowledge Base ID :   1432
Last Reviewed :   May 22, 2014
Source :   BankingInfo
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