The most common myths about investments

Investing is perceived ambiguously: some consider it as a highway to financial freedom, while others see it as a labyrinth with unpredictable turns. The sphere is filled with misconceptions that hinder effective capital management. Debunking myths about investments requires a practical approach, calculations, and understanding of the real mechanisms of income formation.

Illusion #1: Investing is difficult

The myth of the inaccessibility of investments was formed under the influence of archaic notions of the stock market as a club of the chosen few. In practice, brokerage platforms have lowered the entry threshold to a minimum. In 2025, over 62% of investors under the age of 30 started with mobile applications: “Tinkoff Investments,” “Finam,” “VTB My Investments.” All services include educational modules, automatic portfolio selection, and risk forecasting. Access to markets is provided without complex licenses, and entry into the market is possible with amounts starting from 1,000 rubles. For beginners, there is the Individual Investment Account (IIA) regime, allowing for a tax deduction of up to 52,000 rubles per year.

Myth of Unjustified Expectation: Investments Require a Lot of Time

A common misconception sounds like: “To manage capital, you need to track quotes, read reports, and forecasts daily.” In practice, passive strategies require minimal time. A classic index portfolio based on ETFs (for example, FXRL, FXUS, FXIT) needs to be reviewed once a quarter. Asset management companies offer model portfolios for different horizons: 1, 3, 5 years.

Automation allows setting up regular purchases through autopay, and analytics comes in the form of brief digests. Even active trading has been simplified through bots and trading signals integrated into brokerage terminals. For example, in the BCS application, there are hints on technical analysis for each security. Thus, investments of the “for dummies” format do not require delving into the depths of economic models – it is enough to choose a goal, term, and risk profile.

Scale Error: Investing Can Only Be Done with Large Sums

One of the main myths about investments is the idea of millions as the entry ticket to the market. However, statistics from the Tinkoff and Alfa-Bank platforms for the first quarter of 2025 record that 70% of new IIAs are opened with deposits of less than 50,000 rubles. Sberbank shares are trading around 280-300 rubles per share, Yandex – around 3,500. ETFs allow you to buy a diversified portfolio for just 1,000-2,000 rubles.

There is an accumulation strategy: with a monthly portfolio top-up of 5,000 rubles over 10 years at 12% annual interest, the capital will exceed 1 million. This is how the compound interest effect works, described by Einstein as the “eighth wonder of the world.” Investments for beginners do not require large initial investments – regularity and discipline are important.

Misconception of Guaranteed Profit

Belief in stable income without risk is at the core of one of the most enduring myths about investments. Profits and losses are inseparable. Stocks can bring in 15-30% annual returns, but price drops during a crisis can reduce capital by 20-40%. For example, the Moscow Exchange index fell from 3,900 to 2,100 points in February 2022 – losses were almost 45%.

Bond yields depend on the coupon rate and maturity. For example, OFZ-PD 26240 with maturity in 2033 offers 10.9% annual interest, but its price may fluctuate depending on the Central Bank’s key rate. Understanding the risks of investing requires calculating volatility, duration, and scenarios. Guaranteed income is only offered by deposits – but with inflation at 7-8%, they devalue funds.

Approach Error: Buying a Single Stock Is Sufficient

Limiting a portfolio to a single security is a direct path to losses. One of the most dangerous myths about investments is underestimating diversification. When a company falls (for example, the bankruptcy of Transaero in 2015), the investor loses 100% of the investment. A balanced portfolio contains a minimum of 8-12 assets from different sectors: IT, commodities, finance, telecom.

An investor buys Surgutneftegaz with 12% dividends, MTS with a reliable coupon history, ETFs on gold (GLD, FXGD) for inflation protection, REITs for real estate. Each asset is a crisis anchor. Only a multi-level structure reduces downturns.

Misunderstanding: The Main Investment Myth

A common myth ignores the breadth of instruments. The stock market offers:

1. Federal Loan Bonds (OFZ) – with low risk and fixed coupon.
2. Corporate bonds – with increased income, for example, Rosneft or Severstal issue bonds at 11-13%.
3. ETFs – exchange-traded funds covering US, China, gold, real estate markets.
4. Mutual funds – collective investment instruments.
5. Currency – investments in dollars, yuan, or euros as protection against ruble inflation.
6. Real estate – rental income or value appreciation.
7. Commodities – commodities, oil, metals.
8. Cryptocurrencies – high-risk but promising instruments.

Each asset class has its role in the portfolio. With a skillful assembly, a balance between income, liquidity, and risk is achieved.

Forgotten Reality: Market Is Easy to Predict

Pseudo-experts often assure of the possibilities of “precise entry” or predictability of quotes. However, the stock market is a nonlinear system where the price depends on thousands of factors: Fed rates, geopolitics, company reports, crowd behavior. Predicting the behavior of NASDAQ or the Moscow Exchange is impossible even for algorithms.

The “buy and hold” strategy shows stable results: the S&P 500 index from 2000 to 2023 yielded over 200% profit without considering dividends. An investor trying to time the market lost income on commissions and mistakes. How to minimize risks in investing? Use a long-term horizon, discipline, asset rotation, not chasing hype.

Distorted Perception: Trading – a Reliable Way to Enrichment

Myths about investments often confuse trading and investing. The former is short-term speculation on price fluctuations, the latter is long-term value creation. According to the Moscow Exchange data, 87% of traders end up in the red in the first year. Only discipline, loss limitation (stop-loss), proper risk management, and a clear algorithm create the probability of profit.

On average, a trader makes up to 20 trades per day, pays commissions, and monitors charts. This is closer to a profession than to investing. Income comes not from excitement but from structure. Investing in the growth of Polyus Gold over a 5-year horizon will yield more than trying to guess the daily movement of Gazprom.

Critical Thinking – the Main Asset of an Investor

Myths about investments block the acceptance of rational decisions, distract from strategic goals, and create false expectations. Only a clear understanding of mechanisms, regularity, structured portfolio, and emotional control create sustainable capital growth. You can start small, use reliable tools, and rely on calculations. Investing ceases to be “difficult” or “risky” when each action is backed by logic and numbers.