4 Reasons To Avoid ‘Hot Tips' When Investing

Brett Kelly, author of Investment Wisdom, lets us in on the importance of doing the groundwork

- Brett Kelly

Investing? Ever heard a friend or colleague say, “Everyone’s on it, this cannot fail”? Anyone who has even contemplated investing has heard words to that effect at one time or another. Occasionally, someone gets lucky, but jumping on a bandwagon like that is fraught with danger. To have any hope of sustained, long-term success in investment, it’s vital to find out as much as you can about what you plan to invest in. Here’s how to do your groundwork.

WHO IS THE SOURCE?

The first thing to ask yourself if you’re given a so-called hot investment tip is: “who is the source?” How well do you know them and their track record, and how well can you trust them? If it’s coming from a news outlet, how trustworthy are they, and who are the experts they’re using?