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There may be a vast difference in approach between value investors like Canadian billionaire Stephen Jarislowsky and growth investors like William J. O'Neil, but they do agree on one important rule: Keep your emotions in check.

In How to Make Money in Stocks, Mr. O'Neil devotes a chapter to mistakes investors make, and most come down to stupid moves made in panic, greed or just not doing your homework.

Some common mistakes:

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Failing to cut your losses

Most people wait and hope rather than cut their losses when a share price starts falling, an emotional reaction that Mr. O'Neil attributes to pride. He advocates always selling once a stock falls 7 to 8 per cent below your purchase price.

Taking advice from so-called experts

Most tips and rumours aren't true, yet people make investing decisions because of them.

Knowing when to buy

Mr. O'Neil says that investors like to buy a stock when it's heading down in price, but that can be a great mistake. Often stocks on their way down just don't come back up again.

Knowing what to buy

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Many investors prefer to buy large quantities of cheap stocks rather than smaller quantities of more expensive stocks - and are basing those decisions on price rather than quality. Also, Mr. O'Neil says investors pay too much attention to dividends (which he says can weaken a company) and P/E ratios (which he says often indicate that a company's past record is inferior) and not enough to earnings per share growth, which he says is a superior indicator.

Wanting to get rich quick

Investors who want to make a quick buck make far too many mistakes, like speculating too heavily in options and futures or not doing the research necessary to make solid picks.

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