Editor's note: This is the continuation of a special collection of previously published investing lessons from RealMoney contributor and market strategist Barry Ritholtz .
Has this ever happened to you? You've been waiting to deploy some fresh capital . You've done your homework -- checked the charts , looked over the fundamentals . You are ready to make a buy. But moments before you pull the trigger, someone casually mentions something negative about this new target. It could be a coworker or some talking head on TV. Regardless, you hesitate, decide to do some more research, just to be sure... and the next thing you know, your stock pick is off to the races -- without you. All you can think is, thanks for nothing, buddy.
Apprenticed Investor: 6 Investor Types to Avoid
We've all had chance encounters like this. They can cause self-doubt, make you second-guess yourself, wreak havoc with an investment strategy. There are two solutions to dealing with this kind of distraction: One is to become more confident in your own skills. This will occur as you continually educate yourself, which is what " The Apprenticed Investor " is all about. The more confidence you develop, the easier it is to stick to your investment plan and not let third parties bump you off track. The other solution is simpler: Learn to recognize destructive investor personalities -- and stay as far away from them as possible. Last week, we discussed why gains and losses are ultimately the investor's responsibility . But there are some people who can temporarily knock you off your game: These are people to avoid.
The Dirty Half-Dozen
The Enthusiast: He's always breathless; his companies are always on the verge. "Big news is due any day now." There's always someone about to "snap these guys up." He's entranced with new management, i.e., "The new CFO was employee No. 12 at Dell (DELL)!".
At one time or another, we've all been bitten by the infectious salesmanship of the enthusiast. The story always sounds great... yet somehow, the stocks never seem to work out.
The Tipster: The easiest of all the archetypes to recognize, this guy always has a hot story that simply cannot wait. It's about to happen any minute -- a deal to be announced or an imminent takeover.
While the "enthusiast" is all excited about the company, what gets the tipster jazzed is the source of info. "This guy I know is (choose one) head trader at a hedge fund /runs a major wire house desk/at the FDA/on the board of directors."