In a recent issue of the AAII Journal, author Michael Batnick highlights missteps made by investing legends as outlined in his book Big Mistakes: The Best Investors and Their Worst Investments (Bloomberg Press, 2018).

1. Investors tend to expect the future to look like the recent past. “We believe that the object in motion will stay in motion,” Batnick writes. “Successful investing is about finding the balance between being prepared for the good times to last while also understanding that the next bear market is always right around the corner.”
2. Investors behave as if the price we paid for a security somehow should be factored into how we view the investment going forward. “Stocks,” quips Batnick, “don’t care that you hope to achieve a 20% return in the next 12 months.”
3. Investors make the mistake of thinking about the stock instead of the business. “With instantaneous access to information, it’s easy to forget that a stock is more than a price on a computer screen.”
4. People loathe to admit that they were wrong about anything, and this is particularly true with investing. “The best way to prevent large losses,” says Batnick, “is to take small losses. The tricky thing with taking small losses is that you will be wrong again and again and again, and this can be difficult to deal with.”
5. People often look to others for approval. “It’s natural to seek out opinions that agree with you and discard everything else,” according to Batnick. He cites a quote from Benjamin Graham: “You are neither right nor wrong because the crowd disagrees with you.”
6. People are overconfident. Batnick writes, “One particularly dangerous way that overconfidence manifests with investors is leading them to believe thy can handle more risk than they actually can.”
7. Success in one area of life that does not guarantee success in the market. Batnick quotes Michael Mauboussin: “Expertise is domain specific. When experts in one field shift their attention to another field, performance retreats to the novice level.”
8. People think that if they build the perfect model or if they have better information, then they will be able to beat the market. “It doesn’t work this way,” Batnick argues, “because there is one input that can’t be modeled and it’s arguably the one that matters most: How people will feel in the future. Investing is as much an exercise in psychology as it is accounting.”
9. Talking to friends and family about investing is a mistake.  According to Batnick, “Talking about your investments removes objectivity and adds difficulty to an already difficult task.”
10. Intelligence is not enough. “Assume that everybody you’re competing with in the market is smart,” Batnick advises. “Humility is much more important to obtaining satisfactory results than intelligence is.”