Why stock investors fail? | Common Stock Market Failures

Relatable Stock Market Failures: Common Mistakes You Must Avoid

3 Min Read |  April 20, 2021

The really important thing is to profit from your losses. It requires intelligence.

 - William Bolitho

Investment in the stock market is a skill you acquire as and when you go ahead. Practically speaking the idea of ‘you came and conquered’ is vague when it comes to investing in the stock market. 

Dear readers, you are not alone! Be it the case of Franklin Templeton or the case of news reporter Hemant Ghai, the stock market is full of such unsuccessful stories. Even the masters of the sensitive stock market have fallen into the trap of failure. There is no shame in owning up to it, learn from the mistakes and then improvise your future investment steps. 

Nobody is born a great investor, he/she becomes one! 

The process of becoming a ‘great investor’ involves learning and that can come in many forms. Following are some common mistakes that have led to stock failures and related examples that will help you to make profitable investment decisions. 

Stock Market Failures: How do Investors fail? 

Okay, before we hop on to the entire saga of stock failures and relatable stories, let me throw a question at you about your first stock market investment or trade and what was your experience? 

Did you book loss or profit? 

Well, the common mistakes leading to stock market failures are mentioned below. Read them with utmost care so that you do not end being a stock market failure! 

Adding ‘Recommended’ Stocks To Portfolio: 

There are many newspapers that display such articles. The basic idea is to enlighten the investors about which stocks are bullish and the ones having a hard time in the market. 

How many of you have fallen prey to these online communities that not only suggest the stocks to buy and at the same time give fancy reasons as to why the stock price would surge in future? 

Well, acting upon any such recommendations which financial analysis is a big mistake.

I mean you are not buying a dress for a wedding or choosing the menu for a party that you take recommendations from friends, family or experts! It is stocks we are talking about and they work on facts and figures. There is no harm in considering the recommended stocks to add to your portfolio but be cautious and go ahead with buying only when you have done your analysis and studySo, make your own decisions!

Waiting for the Right Time:

One of my friends who regularly invests in the stock market along with her job as a CA, could not book a profit because she was waiting for the ‘right time’. 

With the beginning of 2021, the pharma stocks started to lure attention due to the entire hype of the Covid-19 vaccine. Amid this, the stock price of Sun Pharma that was hovering around the range of Rs 400- Rs 450 in October 2020, went up to the range of Rs 600-Rs 650 in February 2021. My dear friend had been waiting for the right time to book profit by selling some of the Sun Pharma stock from her portfolio. 

When in February 2021 the prices were hovering around Rs 650 she still kept her calm thinking the price would surge even more in the coming months. But, guess what? The so-called ‘right time’ never came for her. The Sun Pharma stock price in fact fell (by minimal percentage) in March 2021 and she missed the opportunity of booking higher profit. 

Well, can you really tell ‘right time’ with something as fluctuating as the stock market? The answer is simply NO. 

So, try to make the best of the situation that the stock market presents to the investors from time to time. Also, keeping a check on your greed would help! 

Taking Investment Decisions In Haste 

One of the most cliche reasons that remain the hero of many stock market failure stories is ‘impatience’. 

On a practical note if you are someone who lacks patience, then the stock market is not the palace to be! You must certainly hurry if you are getting late for the office or getting late to catch a flight on time, but not while taking investment decisions. 

For instance, when the stock market was facing a bloodbath in March 2020 as the pandemic engulfed the world, many investors went into a panic mood and ended up selling stocks whose prices were falling steeply. But, most of them would have felt stupid after few months when the market started to correct itself and thus the performance of many such stocks improved. They could do nothing but regret! 

Therefore, the moment you decide to step your feet on the stock market ground, make sure you have your patience intact and never take investment decisions in haste. 


Many investors face failures in the stock market when they start out. The key point to remember at that point in time is to stick around and not lose hope. 

Make your theoretical aspect strong, learn stock analysis and then invest to convert your failure story into a triumph saga! 

If you wish to know teeth-biting stock market failure stories then tune in to our Youtube channel Convey by FinnovationZ or click on the video above! 

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