In the world of index funds, asset allocation, and diversified portfolios, there are no guarantees. Even solid investments can go south due to bad timing or external forces. Many poor investment decisions can be avoided if you know what to watch for.

A broker recommending an investment doesn’t guarantee a smart move. Brokers may work on commission and not act in your best interest. Higher commission-paying investments may influence their recommendations. Always inquire about how your advisor is compensated.

Beware of pressure tactics to “act now” on investments. Urgency can indicate a scam or speculative bubble. A worthwhile investment today should still be worthwhile next week. Avoid falling for high-pressure sales tactics.

Investing based on Warren Buffett’s moves may not be suitable for everyone. Buffett has resources and access most don’t. Invest based on your own goals and risk tolerance, not solely on someone else’s portfolio.

If a stock’s price is soaring while earnings are stagnant or declining, it may be overpriced. Stock prices should reflect company performance. Watch for a high price-to-earnings ratio without solid earnings growth, which could lead to a correction.

Insider selling in large quantities can be a red flag. Executives know their business best, so significant insider selling warrants investigation. A consistent pattern of insider selling without buying could indicate forthcoming issues.

Avoid investments you can’t explain simply. Complexity may hide risk. Unregistered investments lack investor protections. Stick to products you understand and that align with your financial goals.

Good investing involves understanding what you own, aligning with your goals, and knowing when to walk away. When investments show warning signs, pay attention and don’t ignore them to protect your financial well-being.

Read more at Yahoo Finance: 7 Glaring Signs You’re About To Make a Bad Investment