Greed

Greed will push an investor to think they have some special insider information and can predict what markets do. Markets generally have the current economic information calculated in to the current pricing. The market does not have the unexpected information calculated in and that is what makes it volatile and susceptible to insider trading. Rapid, reactionary trading is called active investing and accumulates multiplied fees and taxes that passive investing does not.

What you have to remember about buying and selling securities or commodities in markets is that every time you are selling something because you think the time is right; for the transaction to be completed successfully, there is someone else on the other end of the trade thinking this is the right time to buy. So it really does put you in competition with them…trying to outsmart them or beat them…rather than holding on to shares for a long period of time and growing with the investment.

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