Investment Basics: Myths about the stock market -How following Warren Buffett may make you end up broke!

Wouldnt it be nice if warren Buffett or even the wide Benjamin Graham suddenly decided to divulge their closed book investment technique that have made them two of the most(prenominal) revered and successful people in the investing origin? Maybe if we recited the steps of the technique kindred a mantra onward going to bed and practiced them diligently for a a few(prenominal) hours every day, we would be able to obtain great riches from the agate line market.

However, the truth is that there is no one- coat-fits-all great investment secret out there for the stock market enthusiast. many another(prenominal) people have the notion that there is a ad hoc method that if they followed rigorously, would bring them instant riches in the stock market .This is most certainly not true. Depending on the size and value of the portfolio, there will be different methods to go about doing business.

For this purpose, it would be good to debunk some of the honey oil myths about the stock market:

1. Just follow what Warren Buffett buys!

Some people tend to have the misconception that if they knew some of the stocks that investing greats like Warren Buffett was purchasing or even futures that George Soros* was trading in and bought the same shares/bonds/options, they could instantly make money. This could not be advance from the truth.



Firstly, some of the shares that Warren Buffett owns are public information. Almost everybody in the industry knows that Warren Buffett owns shares in companies like Coca-cola, Hersheys and Gillette.

However if we were to jump into the bandwagon and acquire all the shares that we could of these three companies, there would still be a major difference between the value of our shares and that of Warren Buffetts, to wit the price that we bought the shares for. Price is everything.

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