New Year’s resolutions for irrational investors

It is one week into 2007 and it is not too late for New Year’s resolutions. Here are ten new year’s resolutions for irrational investors from Paul Farrell of MarketWatch. I say it should be lifetime resolutions for irrational investors. For passive investors, achieving them is piece of cake, except point 10 because no-load index funds do not exist in Singapore and probably spell obscene to commission-based fund distribution channel.

  1. OK, say it out loud: ‘I am an irrational investor!’
  2. Yes, I know I’m running a handicap race against Street pros
  3. I will never again try to predict our unpredictable markets
  4. Yes, I’ll be optimistic about my life, but not the market
  5. I will focus on the long term and stop active trading
  6. I resolve to live ‘below my means,’ saving 10% for retirement
  7. I resolve to trust nothing I read in the media
  8. OK, I know my broker’s advice is always biased in his favor
  9. I promise I will build a well-diversified portfolio
  10. In 2007 and beyond, I will only buy no-load index funds

Read each resolution in detail HERE.

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