Stock Market Myths

Myth 1: Stock market investment is risky and can make you lose money

It is true that stock market investment has its own risk, so does holding to a single job especially in the private sectors. During global economy slowdown, lots of people loses their jobs.

One can lower the risk of stock market investment and avoid losing money by diversifying the investments into several good companies at an undervalued price. Stock market investment has its own risk, but it doesn't have to be risky. Just like driving a car on the road. Driving a car has its own risk, but it doesn't have to be risky.

Myth 2: Playing stock market is like gambling

Buying companies' shares from the stock market can only be a form of gambling if the individuals treated it as a gamble, that is, blindly dumping their money into the stock market without doing any research on the companies.

Myth 3: One needs to have lots of money to invest in the stock market

Fact is that one can begin investing in the stock market if one has at least RM 1k.

Myth 4: Stock market always crashes in September or October and they are bad time to invest

It is just a psychological market fear that has no substantial evidence or facts to prove that it is true. In fact, there were times when stocks continue to rise during these 2 months and go down on other months. So to believe that all stocks will definately go down during these 2 months is nonsense.

Myth 5: Investing in Unit Trust is safer than the stock market

Most Unit Trust invest their funds in the stock market. So when the stock market crashes, so does most Unit Trust as well. Your investment in Unit Trust can also drop in value, as much as 40%, if it is run by a lousy fund manager.