In the coming weeks I am going to write about the seven deadly sins in investing, according to Scollon. Not because it will fill seven weeks of editorial - in fact I am always wary about serial articles - but rather I see these sins being committed regularly. In fact, daily before my very eyes. And it is easy to avoid them.

And I say to myself, "there are some poor souls out there who manage consistently to do everything that will ensure failure." Alas"

I feel a bit like the preacher man but in the hope that some readers may just see the light and want to avoid one or more of these venial matters - this encourages me to proceed.

Firstly, be careful what you read, what you listen to, and what you believe.

I am reminded of this every day as I scan the financial press. But this week was a particular case in point when I saw reports from one economic body that says Australia will be last into this recession and will be first out; then another that says this will be a deep and long recession. Then we have some joker from overseas out here saying we are about to go into the mother of all recessions. Would you believe that he has just written a book?

If you enjoy reading, then that's fine - but just be careful about the 'takeaway.' It is the 'takeaway' that is dangerous. Look but don't eat. If you have a real interest in fundamentals and economics, then do some study and know what you don't know. That will lead you to wisdom.

Despite being an economist by training I use pure technicals when it comes to my own forecasting and stock timing and picking. I spend five minutes scanning the financial press, only to have a sense of what some are thinking and, for light laughter, about some of the rubbish that goes to print or on air or on screen.

I acknowledge, however, the probable reality is that 98% - my guestimate - of investors want to use fundamental analysis. And I concede that. But if you are going to use fundamentals and news, then at least set yourself up properly with some decent tools and use them consistently. It's a sin to react to sensationalized and badly researched news stories.

One of my beefs about fundamental analysis is that it is just too tough to grasp all that is going on in the world. This is true for even full-time analysts, so you can imagine how tough it is for the average investor.

So you need efficient, clinical tools like we use in technical analysis, but of a different kind. Check out www.valuegain.com because it will provide you with time saving objective ways to distill the vast amount of data into something that is easy to understand, within a framework that you can easily incorporate into your plan.

Part of your investing plan should cover specifically what you will read what you will ignore, and you must be very clear on this - otherwise, you will become very befuddled" and that will make it very tough to be decisive in your actions.

Enjoy the ride

Tom Scollon
Chief Analyst
Trading Tutors Team