As market rises, investors tend to forget that risk is a four letter word, greed takes over, and those who once thought themselves in the conservative camp abandon caution in search of higher returns and what looks to be easy money to be made.
But an investor's tolerance for risk is part of his or her basic personality, and tolerance for risk rarely changes. People are risk takers or risk avoiders by nature.
Investors and the markets are said to be rational, but most people are heavily influenced by their emotions. The primal emotions of fear or greed often cause investors to play the loser's game of buying high and selling low.
Keep INVESTING Simple and Safe (KISS) ****Investment Philosophy, Strategy and various Valuation Methods**** The same forces that bring risk into investing in the stock market also make possible the large gains many investors enjoy. It’s true that the fluctuations in the market make for losses as well as gains but if you have a proven strategy and stick with it over the long term you will be a winner!****Warren Buffett: Rule No. 1 - Never lose money. Rule No. 2 - Never forget Rule No. 1.
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