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The 10 Biggest Investing Mistakes — and How to Avoid Them

Investing is simple. Staying invested is hard. The biggest return-killers aren't crashes or recessions — they're the mistakes we make ourselves. Ten of them we see over and over. In clients, in friends, in ourselves.

By Thierry Borgeat · Reviewed by Patrick Rissi, CFA and Florian Jauch, CFA · Last updated April 2026 · 14 min read

There's a paradox about investing: the theory is unbelievably simple, the practice unbelievably hard. The theory fits on an index card — diversify broadly, keep fees low, stay invested for a long time, automate your savings, don't sell in a crash. That's it. And yet: the majority of private investors fail to achieve the returns of the funds they're invested in. Not because they don't know the theory. But because between theory and practice there's a chasm, and its name is behaviour.

This behaviour gap has been measured extensively. Vanguard's Advisor's Alpha, Morningstar's Mind the Gap, Dalbar's Quantitative Analysis of Investor Behavior (QAIB), JP Morgan, Envestnet — they all reach the same result: private investors lose approximately 1.5% to 3% per year compared to the returns of the funds they're invested in. Not because of fees. Because of timing mistakes, panic selling, trend chasing, and strategy switches at the worst possible moment.

We've collected the ten most common of these mistakes. With verified numbers, Swiss context, and concrete solutions. At the end you'll find a summary you can print and stick on your fridge — intended for the next moment the market falls and you're tempted to click "sell".

01Mistake 1: Starting too late

The most expensive mistake of all — and the most invisible. Because you never see what you missed. The difference between a savings plan that starts at 25 and one that starts at 35 looks like "10 years less" at first glance. The reality is more brutal: through the compounding effect, the early years matter disproportionately.

Assumption: 7% nominal annual return, monthly compounding, before fees and taxes. Historical equity market averages over long periods.

Read that carefully. An additional CHF 36'000 in contributions (over 10 years at CHF 300/month) produces CHF 421'500 more in end value. This is the compounding effect Albert Einstein allegedly called "the eighth wonder of the world". Whether the quote is really his is disputed — the math behind it is not.

Solution: Start today. Not tomorrow, not "when I earn more", not "when the market looks better". A savings plan starting at CHF 100/month is enough — the most important thing is starting itself, not the amount. You can increase the amount later at any time, but lost time you never get back.

02Mistake 2: Waiting for the perfect entry point

"The market is at an all-time high right now — I'll wait for a pullback." We hear this sentence literally every week. It sounds reasonable, but it's one of the most expensive mistakes there is.

The reason: the equity market statistically spends a surprisingly large share of its time at or near an all-time high. This isn't a sign of excess — it's a mathematical consequence of the fact that the global economy and corporate earnings grow long-term. Every new high feels dangerous. And every new high later becomes a new "low" compared to what came after.

Solution: Set up a savings plan. You invest automatically on the 1st of the month — no matter what the market does, no matter what the headlines say, no matter how you feel. This eliminates the timing question completely because it's never asked. In rising markets you buy at higher prices, in falling markets at lower ones, and over 20+ years the entry price averages out so that it's usually below the average price of the period. That's the famous cost averaging effect.

03Mistake 3: Selling in a crash

The classic. The market falls 20%, 30%, 40%. The news screams "the biggest crisis in X years". Your portfolio is bleeding. Every day feels worse than the one before. You sell, "to avoid the worst". And then what always happens, happens:

The pattern is always the same: the best market days come directly after the worst. This is due to the nature of fear-driven markets: they fall too far, then the panic corrects, then prices snap back with force. Anyone who sells at the trough is gone when the recovery comes — and almost always comes back only after most of the recovery potential is already gone.

Solution: Stick this sentence on your fridge door during crises: "Every crash feels like the end of the world. None of them was." And: keep the savings plan running unchanged. You buy in the crisis at lower prices, which amplifies returns after recovery. This isn't "brave" — it's simply mathematically correct.

04Mistake 4: Paying too much in fees

The most dangerous mistake, because it's invisible. No one sends you a bill for CHF 190'000. No transfer, no debit, no notification. The fees are quietly deducted from the fund's assets before the return even reaches you. Most investors have no idea what their products really cost — and that's by design in the business model of many bank advisors.

The math is so painful because fee differences compound dramatically over long periods:

Gross return 7% p.a., net accordingly 6.7% and 5.5%. Verified with compound interest formula.

Your bank advisor readily recommends actively managed funds with 1.5%+ TER — not because they perform better (the majority underperform the index over long periods), but because the bank or advisor earns from the fees (retrocessions, management fee, front-load charges). And they will never show you this table.

Solution: Ask about the Total Expense Ratio (TER) for every investment — it includes all ongoing costs. And ask a counter-question that's almost always revealing: "Do you invest your own money in this product?" The answer (and how it's given) tells you almost everything you need to know. At arvy, the three founders each invest over CHF 100'000 of their own money in the same portfolios as clients. That's not a marketing gimmick — it's a structural incentive fit.

05Mistake 5: Putting everything on one bet

"My colleague made 300% with Tesla." Sure. And your other colleague lost everything with Credit Suisse. Single-stock bets aren't investing — they're speculation. And in 2023 Switzerland got a living example of how even seemingly invulnerable blue chips can go to zero.

Diversification isn't "caution for cowards". It's a mathematically provably superior strategy for generating more return per unit of risk. That's the foundation of Modern Portfolio Theory, for which Harry Markowitz received the 1990 Nobel Prize in Economic Sciences. The essence: non-correlated positions reduce portfolio risk disproportionately without reducing expected return.

Solution: Diversify. At least 20–30 companies across different sectors and regions. An ETF does this automatically (an MSCI World holds about 1'500 stocks). A quality fund like arvy concentrates on the best ~30 companies — concentrated enough for outperformance chances, diversified enough that a single failure like Credit Suisse doesn't threaten your entire wealth.

06Mistake 6: Chasing trends and hypes

NFTs. Meme stocks. SPACs. Cannabis stocks. Cathie Wood's ARK Innovation ETF. Crypto ICOs. AI hype. The pattern is always the same: you hear about it when it's already too late. And when you then enter, you're the last one who still believes — and the first to sell when the bubble bursts.

Current examples that follow this pattern: cannabis stocks after Canada legalised in 2018 (many fell 70–90% from their highs), SPAC boom 2020/21 (many SPACs lost 50–80% since closing), meme stocks January 2021 (GameStop, AMC — most late-joiners are sitting on massive losses), ARK Innovation ETF (from over USD 150 in early 2021 to under USD 40 at the low).

Solution: Invest in companies, not in stories. Quality companies with strong margins, growing profits, and real competitive advantages perform unspectacularly — but reliably. Boring is profitable. Anyone who invested in a quality compounder fund in 2018 instead of cannabis stocks has dramatically more money today. And significantly fewer grey hairs.

07Mistake 7: Not having a plan

Investing without a strategy is like driving without a destination — you go in circles and burn fuel. Most people don't have a written plan. They have vague intentions ("I should invest someday") and emotionally-driven decisions ("Now looks good/bad"). That's not enough — especially not when the market comes under stress.

A good plan doesn't have to be complicated. It must answer four questions:

1. Goal. What are you investing for? Retirement at 65? A house in 10 years? Generational wealth? The goal determines the horizon, and the horizon determines the risk.

2. How much per month? An amount you can maintain even in difficult months. Better CHF 500 reliably than CHF 1'000 with yearly interruptions.

3. In what? ETF, quality fund, mix with bonds — and then stick with it. The specific building block matters less than the discipline not to constantly switch.

4. What if it crashes? This is the point almost no one clarifies in advance. How will you react at −30%? At −40%? Will you hold? Will you invest additionally? Will you shift into lower-risk assets? You must answer this question before the crash. In the crash itself, rational thinking works worse.

Solution: Write down your plan. Really. On paper or digitally. "I invest CHF X per month in Y until age Z, and I will not sell in a crash — on the contrary, I will continue my savings plan because lower prices mean better entries." Then sign it. That sounds silly, but it works because it binds your future panicked self to your present rational self. In behavioural economics this is called a commitment device.

08Mistake 8: Not understanding Swiss taxes

Switzerland has one of the most investor-friendly tax systems in the world — but only if you use it. The three most important points many private investors ignore:

Capital gains are tax-free — dividends aren't

A price gain on selling a share is tax-free for private individuals in Switzerland (as long as you're classified as a "private investor" and not a "commercial securities trader"). A dividend payment, on the other hand, is fully taxable as income. This makes accumulating ETFs (which reinvest dividends instead of distributing) significantly more tax-attractive than distributing ones — especially in high-progression cantons.

Withholding tax: reclaim 35%

On Swiss dividends, the state automatically deducts 35% withholding tax (Verrechnungssteuer). You can reclaim this amount in your tax return — but only if you correctly declare your securities holdings. Anyone who forgets or ignores this gives away money. For a CHF 100'000 portfolio with 2% dividend yield, we're talking about CHF 700/year in forfeited taxes, or CHF 21'000 over 30 years.

Maximise Pillar 3a — every year

The Pillar 3a contribution (2026: CHF 7'258 for employees with a pension fund) is fully deductible from taxable income. At a marginal tax rate of 30%, that corresponds to an annual tax saving of ~CHF 2'175 — before the money generates any market return. Over 30 years: CHF 65'250 in direct tax savings, additional to the market return on the 3a capital. And since 2026 even retroactive 3a contributions are possible for missed contribution years.

Solution: Maximise Pillar 3a every year. Cleanly declare securities in your tax return. Reclaim withholding tax. Prefer accumulating over distributing ETFs. Multiple 3a accounts for staggered later withdrawal.

09Mistake 9: Checking the portfolio daily

The S&P 500 has historically had a positive close on about 54% of all trading days and a negative close on 46%. Sounds like a slight advantage — but it also means: anyone who checks their portfolio daily experiences almost half of all days with a negative feeling. And negative feelings lead — for most people — to bad decisions.

The writer Nassim Nicholas Taleb described this phenomenon elegantly in his book Fooled by Randomness: the finer the temporal resolution, the more noise you see — and the less you see the underlying signal. The coarser the resolution, the more positive and clearer the picture becomes:

Anyone who checks daily lives in a permanent mini-stress state and is constantly tempted to "act". Anyone who checks quarterly is more relaxed and makes more rational decisions. Anyone who checks only once a year is often surprised at how well their portfolio has done — without any of their input.

Solution: Check your portfolio at most once per quarter. Remove broker apps from the home screen. Disable notifications. Reading the weekly arvy newsletter is enough as "investor content" — it contains everything you need to know without emotionally activating you.

10Mistake 10: Switching strategies when it gets hard

This is the biggest mistake of all — the sum of all the others. And simultaneously the hardest to avoid, because it feels like "rational action" while it's happening.

The pattern typically looks like this: you invest three years in a quality fund. Then a tech hype comes, tech stocks rise 80%, your quality portfolio rises 15%. You think: "Wrong strategy, I'm missing the train." You sell and buy tech. Six months later the bubble bursts, your tech portfolio falls 40%. You panic, sell, go to cash. After 2 years in cash you see the market rising, you buy again — right before the next correction.

Result: bought three times, sold three times, wrong timing three times. This is the behaviour gap in its purest form.

Solution: Choose a strategy that fits you — and stick with it. Quality investments underperform in hype phases, that's not a bug, that's a feature. They don't capture the full upside of bubbles, but they also don't lose 50% in a crash. The tortoise wins the marathon, not the sprint. And a partner who carries you through the difficult phases — whether an advisor, a community, or a regular, educationally-focused newsletter — is worth more than the 0.5% you might save through a "better" product.

11The summary: 10 mistakes, 10 solutions

"It is remarkable how much long-term advantage people like us have gotten by trying to be consistently not stupid, instead of trying to be very intelligent." — Charlie Munger

You don't have to be a genius to invest successfully. You don't have to be a market-timing expert. You don't have to be a stock picker. You just have to avoid the big mistakes — and time and compounding do the rest. That's what Munger means by "consistently not stupid": don't optimise for the last percent, avoid the obvious catastrophic decisions. In investing, that's actually where most of the value is.

12Frequently asked questions

Investing without the typical mistakes?

With arvy you invest in 30 hand-picked quality companies — diversified, with low fees, automated via a savings plan. Three CFA charterholders investing their own money in the same portfolio. A weekly newsletter that carries you through crashes. And FINMA supervision as the foundation. No hype, no timing, no stress — just what demonstrably works over 20–30 years.

Written by Thierry Borgeat, Co-Founder of arvy, and reviewed by Patrick Rissi, CFA and Florian Jauch, CFA. All three invest over CHF 100'000 of their own money in the arvy portfolios. Sources for the behaviour gap: Vanguard's "Advisor's Alpha" (regular updates), Morningstar's "Mind the Gap" (annual report), Dalbar's "Quantitative Analysis of Investor Behavior" (QAIB), JP Morgan's "Guide to the Markets" and "Guide to Retirement". Historical data on the Credit Suisse collapse based on publicly documented events from March 2023. All calculations independently verified using standard financial formulas. Last updated April 2026.

Disclaimer: This article is for general educational purposes and does not constitute personal financial or investment advice. Historical returns are no guarantee of future results. Amounts cited are estimates and vary by market development, canton, and individual situation. arvy is a FINMA-supervised asset manager with a CISA licence. Imprint & Legal Notice.