Common investing myths like “buy and hold always wins” can hurt returns — learn what really drives success.
Sectors & Industries
November 12, 2025
Table of Contents
There’s no shortage of advice in the investing world. Friends, pundits, financial influencers — everyone has a “rule” they swear by. But over time, some of the most commonly repeated phrases have become myths. And while they may sound comforting, they can seriously hurt your returns.
Let’s unpack the biggest investment myths still floating around — and what smart investors do instead.
This one gets repeated constantly — often with the warning that trying to time the market is a fool’s errand. But here’s the truth: you can time the market, just not in the way most people think.
Warren Buffett is proof. Before the 2008 crash, Buffett built up billions in cash. When stocks plunged, he used that war chest to buy into Goldman Sachs and GE at discounted valuations. He repeated the same playbook during the COVID crash in 2020 and again in 2023.
Buffett wasn’t guessing. He was preparing. Timing the market isn’t about predicting exact tops and bottoms — it’s about knowing when prices are stretched and having the patience and liquidity to act when they reset.
Long-term investing is often portrayed as a guaranteed path to wealth. But that only works if the business stays strong.
Take GE, for example. In 2002, it was the largest company in the S&P 500. But 20 years later, investors who held the stock had little to show for it. The company lost its competitive edge, faced operational issues, and the market moved on.
Buy and hold isn’t a universal strategy — it’s a conditional one. If the company’s story changes, your strategy should too.
Diversification is meant to reduce risk, but it’s not a magic shield. In major crashes, it often fails.
In 2008, stocks, bonds, and even real estate declined simultaneously. Owning different asset classes didn’t offer much protection because systemic risk hit everything at once.
Real protection doesn’t just come from owning more tickers — it comes from understanding catalysts, timing your entries, and identifying what truly drives price movement.
This is often used to soothe nerves during corrections — and in the U.S., it has largely held true. But it’s not a guarantee.
Japan is the cautionary tale. In 1989, its Nikkei 225 index peaked near 39,000. More than three decades later, it still hasn’t fully recovered to those levels, despite bouts of growth along the way.
Time helps, but price matters more. Valuation, macro conditions, and structural tailwinds all play a role. Simply holding for decades doesn’t guarantee profits.
It might feel logical — the more risk you take, the more you stand to gain. But in reality, most high-risk trades lose.
The best investors don’t chase risky bets. They look for asymmetric opportunities: setups where the potential upside far outweighs the downside. They manage risk, not seek it.
People like Buffett, Stanley Druckenmiller, and George Soros didn’t build their wealth gambling on speculative trades — they found mispriced assets with defined catalysts.
The best investors constantly challenge assumptions. They question the rules. They adapt. Because success in the markets doesn’t come from luck — it comes from preparation, patience, and paying attention to what truly moves prices.
That’s where data beats dogma.
LevelFields AI was built for investors who want to focus on facts — not myths. It tracks the real events that impact stock prices, from buybacks and dividend hikes to CEO departures, contract wins, and FDA approvals.
It doesn’t just notify you that something happened — it shows you how similar events affected other stocks historically. That means you’re trading with context and probability, not just headlines.
Instead of following outdated “rules,” you can follow the data — and act on it before the rest of the market reacts.
Find out how LevelFields can help you break free from investing myths and trade smarter.
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