Back in 2006, an investor started asking himself an interesting question. While I am surely making profits in the market, how is my broker making more by way of brokerage than me? Is it fair that he makes more money when I take the investment risk? A closer analysis revealed that the broker was making him trade and churn his holdings for the sake of brokerage. Just by asking himself this simple question, he saved his day.

An investor or trader needs to ask a variety of questions the moment they get investment advice. Is the advice in sync with the market or contrarian, and what is the logic? What has been the historical performance of the stock being recommended? Is this the best price I can buy the stock, or should I wait for a better price? What is the holding period the advisor is recommending and what is the time frame I am mentally prepared for? These questions can address a lot of issues.