Investing can be a rollercoaster. It’s easy to make mistakes, especially when emotions, market conditions, and lack of strategy come into play. However, these common pitfalls can be avoided—and that’s where automated investing steps in. In this post, we’ll cover the top 5 investment mistakes and explain how automated investing helps prevent them, saving you both time and money.

Mistake 1: Failing to Diversify

You’ve heard the phrase, "Don’t put all your eggs in one basket." This applies to investing in a big way. Many investors make the mistake of concentrating their investments in one or a few assets. Whether it’s due to familiarity, a hot tip, or overconfidence, failing to diversify exposes your portfolio to higher risk.

How Automation Solves It

Automated investing solutions, like Surmount, utilize smart portfolios that automatically balance across different asset classes—stocks, bonds, commodities—based on your risk tolerance. These strategies ensure you're not overly exposed to one asset, which helps to reduce risk and smooth returns.

Mistake 2: Emotional Reactions to Market Fluctuations

Markets go up, markets go down. It’s normal. But reacting emotionally—whether by panic-selling during a downturn or chasing the latest "hot stock"—is a common investment mistake. Emotional decisions often lead to buying high and selling low, which can erode your gains over time.

How Automation Solves It

Automated investing removes emotional decision-making from the equation. Platforms like Surmount follow pre-programmed strategies, which means your portfolio is managed based on data, not your gut reaction to the latest news. This prevents knee-jerk decisions and keeps your investments on course, even during volatile times.

Mistake 3: Trying to Time the Market

Many investors believe they can "time the market"—buying low and selling high with perfect precision. The reality? It’s extremely difficult to get it right consistently. Research shows that even seasoned professionals struggle with market timing, and individual investors often end up missing the best days in the market.

How Automation Solves It

Automated investing systems continuously stay invested based on a rules-based strategy. This allows you to benefit from long-term trends without trying to predict short-term movements. By automating your investments, you avoid the temptation of guessing the market and let your portfolio grow over time.

Mistake 4: Ignoring Fees and Costs

Hidden fees can eat away at your returns. Many investors overlook the cost of expense ratios, trading fees, and advisor commissions. Over time, these costs add up and can significantly reduce your portfolio’s performance.

How Automation Solves It

Platforms like Surmount operate on a transparent subscription model, meaning you pay a flat fee for access to automated investment strategies. This eliminates hidden fees and makes it easier to track how much you're paying. No more worrying about high advisory fees or complex fee structures.

Mistake 5: Not Rebalancing Regularly

Over time, the value of your investments will shift. Stocks might outperform bonds, or one sector might grow faster than another. If you’re not regularly rebalancing your portfolio, you can end up with an allocation that no longer fits your original risk tolerance.

How Automation Solves It

Automated investing platforms like Surmount automatically rebalance your portfolio. This means the system adjusts your investments back to the desired allocation without you lifting a finger. It ensures that you’re always aligned with your risk tolerance and investment goals.

Why Automated Investing Prevents These Errors

Automated investing is a game-changer for those who want to avoid these costly mistakes. Here’s why:

1. Consistency: Automation ensures you stick to a long-term strategy without getting distracted by day-to-day market noise.

2. Transparency: Automated platforms like Surmount offer clear pricing and easy-to-understand strategies, so you’re always in control.

3. Data-Driven: Decisions are made based on data and pre-set rules, not emotional whims.

4. Convenience: You don’t have to constantly monitor your investments—automation does the work for you.

By avoiding these common mistakes through automation, you can optimize your investment performance and feel more confident about your financial future.

Final Thoughts

Investing doesn’t have to be complicated, but it does require discipline. The reality is, human nature often gets in the way. By automating your investments, you remove the emotional biases and common errors that derail so many portfolios. Surmount’s automated strategies are designed to help you stay diversified, keep costs low, and avoid emotional reactions—setting you up for long-term success.