Your ignorance may be a delightful experience for you, but when it comes to your money  and the question is of your profit and loss statements, all and sundry should become little more sensitive and wants to investigate the market and stocks condition first, before investing money. Some of the common investment mistakes, you are doing while investing in the stock market are given below:

1. Ignoring Financial Experts:

The key points of stock selection for your portfolio are the financial experts, the weekly or bi-weekly trade magazines and business schools. Where every stake holder has been keeping an eye on every movement of the market. The analysis of above mentioned mediums can only provide half of the picture, because calculated P/E ratios can only describe the situation of the company in the stock exchange for a specific point of time. They can forecast the situation assuming the different analysis but cannot tell us where it is heading.

2. Overlooking Macroeconomic Conditions:

If the investor has not given consideration to the macroeconomic conditions like unemployment and inflation and how might they impact on the sector they are interested to be invested in, they will make a big mistake.

There are numbers of factors, which are controlling the stock prices like oil prices, labor costs, scarcity of raw materials, strikes, interest rate fluctuations and consumer spending. They could make an adverse impact on share price.

3. Neglecting Dilution:

Look for companies that are constantly issuing shares and creating a dilution, or those that have been issuing convertible debt. This will result in a lower value of holdings for existing shareholders.An investor should look for the companies that are re-purchasing their own stocks and therefore, reducing the number of shares outstanding. This process increases earnings per share (EPS).

4. Misplacing Sector Trends:

There are some stocked in the market that jump higher as compared to their peers and this behavior usually occurs because there are some huge catalysts that drive the stock either higher or lower.

5. Not Distinguishing Cyclic Fluctuations:

This is one of the market realities that there are different points of times in a year, when many companies go through boom and bust cycles. Different analysis and forecasting make these ups and downs easy to predict. This is highly recommended to have looked on that analysis and predictions before investing in these companies.

6. Buying When Prices Drop:

It basically means that buying when a stock pricing is dropping, but it can be exceptionally profitable when it works out. Some investors love to adopt this type of investment policy they buy companies on the cheap and make money by selling these shares at high prices.

7. Technical Analysis:

Most of the investors are not giving importance to the technical analysis of the company where they are interested to invest in. For any technical analysis, a simple graph could provide you the picture of share life (all ups and downs) in different instance of market. It can give a good picture to the investors and will make the life of an investor easy for investing money in any company.

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