Bad habits: 5 reasons why mobile apps are destructive for investors

A successful investment is a long and slow process. There are a lot of pitfalls to overcome and there is a lot of noise (in the form of content, misleading information, irrelevant information, etc.). Although not on our list of 7 Secrets to Successful Investing, we believe there is one very bad habit that is destructive for most investors: mobile apps that allow you to track stock prices and other assets. We list 5 reasons why we think mobile market (stock) and portfolio tracking apps are pure poison (most of the time).

One of the most misleading and confusing features is the daily profit/loss status that is presented on all interfaces of brokers, exchanges and market (stock) tracking apps. This creates a lot of noise in the investor’s head.

Reason #1: Daily Income statement statement.

One problem with “daily P/L status” is the mental focus it creates on day-to-day price changes. Needless to say, this is destructive to the mental state of the investor. This creates a will and a desire to come back every day and watch a “good result”, seemingly missing all the relevant information related to the trend and the turn.

Reason #2: every day Statement of income statement.

Another problem with “daily P/L status” is the illusion of profit (also loss). Most of the time, the profit and loss situation is not realized. Why does unrealized profit make an investor happy, and why does unrealized profit make an investor sad?

While the problem in point #1 mentioned above is a mental problem, the problem with P/L status is an emotional problem.

We recommend readers spend some time reading Investing Secrets: How The ‘Investing Triangle’ Can Help You Improve Your Investing Decisions.

Reason 3: green and red color codes.

The classic color code is such a horrible invention: green makes you happy, red makes you sad. It sends emotional signals to the human mind, in a very subtle way, which over time can have an effect on the inner state of the investor.

Better to focus on charts that show trends and turning points.

Reason #4: snapshot versus trend.

Mobile apps usually display a snapshot of the price (or portfolio situation). Focusing on the snapshot distracts you from what really matters: the trend.

Spend more time analyzing the trend, spend less time on snapshots.

Reason #5: You’ll miss the turns.

All in all, by combining the above points, you realize that these mobile apps with these classic distracting features create a poor focus. In the end, what matters are the trends. Equally important, turning points are what investors should be looking for.

When you’re long, all you want to do is stay seated for as long as possible. You want to know when a bull run is reaching a turning point. When you’re short, all you want to do is stay seated for as long as possible. You want to know when the bearish momentum reaches a turning point.

InvestingHaven’s premium services cover the in-house investing and trading spectrum. Over 80% of failed trades are due to the mental and emotional system of the individual market participant. We cover emotional and mental reactions to open and closed positions in detail in our Trade Alerts service (short-term trading) and our Momentum Investing service (medium-term investing). Moreover, in hyper volatile markets like crypto investing, it is even more crucial to success than in any other market. Our premium members experience this as “coaching” and they find great value in it (this is what they tell us unanimously).