Most of armature investors in Sri Lankan tend to do lots of mistakes in sri lanka share market due to their inexperience and lack of knowledge. So in here I’m going to discuss 5 commons mistakes which most of beginner level investors do. It’s vital to have knowledge on what are the areas which you may fall in to trap in this investment journey in sri lanka share market.

1. Do Share trade without knowledge

This is one of the common mistakes that beginners do. Do not enter in to share market without proper knowledge about the share market and its operation. It’s not like a gamble put small amount of money and receive a lot. Most of armature people enter in to Sri Lanka share market only to gain money and become rich quick but the reality is Investor need to have better knowledge with lot of patient to get success in Sri Lanka Share market.

2. Invest on Short Term Objectives

Some of the investors think that share market is for short-term purposes. For example they expect gain money in less than one week. If you are lucky enough in bull market its possible to earn good amount of money in such a short period but to gain in short-term required such good technical knowledge on supply and demand and it’s not 100% accurate some time. So only focused on short-term investment may become another big mistake in Share market.

3. Try to do gamble on sri lanka share market

This is one of the common mistakes that inexperienced traders and investors do. As I told earlier most of Sri Lanka thinks that Colombo Stock Exchange is like a casino and they try to do grumble in this market which is completely foolish thing to do. Colombo Stock Exchange is one of the prestigious markets in Asia and the institute is highly regulated by so many institutes. So it’s not a casino so the investor or trader need to have a good knowledge on fundamental and technical analysis skills to analysis the market and analysis the companies before take better investment decisions.

4. Buy more and more shares that you can’t afford

Buy more shares which you can’t afford is definitely creating huge losses in this market.  Investor need to focus on the limit which he or she can buy in this market. Most of broker companies provide margin facilities but inexperienced armature investor falls in buy lots of shares in credit facility create huge disaster on his portfolio. So if you are a beginner remember to buy shares with what you got right now.

5. Not Diversified the Investment or portfolio

One of the golden rule is investment is Diversification. This rule is also applied for Colombo Stock exchange also. Well proper diversified portfolio reduces the risk of investment and it’s always wiser to proper diversified your investment in Colombo Stock exchange.

I’m also plan to post another article regarding the most common mistakes which do on Colombo stock exchange and hope the article is useful.