Do you ever wonder how some people invest in just the right things? And that their investment decision never yield bad results? This may be a bit too far-fetched because every investor makes some mistakes and learns from it. But the best way to be a good investor is to learn from other people’s experiences and make the most out of their advice. Life is after all too short to learn from your own mistakes!

Below are the three investment trends you should avoid if you are investing for profit and growth:

Investing in Brand Names:

Most of the investors are generally involved in making this mistake. The dazzling image of the company leads people to believe that the stocks are more profitable. But this is just a false front and many brands are in deep trouble underneath the surface. If it is long term security than the brands are a good place to invest because they well-established with large capitals but they are not a very smart investment opportunity in terms of profit and growth.

These stocks are less risky, so they should occupy a small portion of your overall collection. With overvalued stocks, there lie little growth opportunities and hence, avoiding large investments is the key if you are investing for profit and growth.

Investing in Penny Stocks:

Penny Stocks have little capitals invested in them and hence, they fetch little profit and their trade price is also low. These stocks are risky for investment because they are controlled by sizable traders. Penny stocks are terrible options to both, invest or trade. The reason for the growing investment in penny stocks is because of the thinking that bulky investment can be made at cheaper cost with high selling price to yield maximum profit. The investors based on this knowledge make large investments that prove to be fruitless most of the times. Because of the lack of right management, this is an investment you should avoid under all circumstances.

Overlooking Stock Value because of Price:

This is the most common problem with investors who are new to the market. Quite often these investors gamble in stocks with luring prices but there’s no actual market value to the stocks at close inspection. Without proper market analysis, the stocks look like a successful investment plan with a high yield promise. But behind the entire glamor, these stocks are quite unstable and are not a very good investment opportunity. You should properly evaluate the background of the company and try to know the actual stock value instead of going for the deceitful price.