On one hand, there were individuals who built up quality share portfolios over time and made a significant amount of money, and there were traders who made money more often than they lost it. On the other hand, there were many, many individuals who lost money – the number one culprit was emotions. Private client investors get caught up in the emotions of the market.
When they see headlines that the JSE is breaking new highs or that the market is up 30% in just six months; that is when they want to invest. Invariably that is exactly when you do not want to invest – when the market is getting expensive. Then, when the share market crashes, they forget that this is a long-term investment and tend to sell at the bottom. They have bought the shares at the peak of the market and sold at the lowest price, which loses them money.People also see the stock market as a get-rich-quick scheme. They bet on tips they hear at dinner parties without thoroughly researching the company they are investing i