Know what you own and how much concentration risk you are taking.
Two different approaches
A stock represents ownership in a company. An exchange-traded fund typically holds a basket of assets according to its stated objective and trades on an exchange. Both can rise or fall in value.
Diversification can reduce dependence on one holding, but it cannot eliminate all risks. An ETF can still be concentrated in one sector, market or asset class.
Review before investing
For stocks, examine the business, financial position, valuation and risks. For ETFs, review the index or strategy, holdings, costs, trading liquidity and tracking differences.
Understand order types and avoid placing trades solely because of a tip or urgency. Keep records of what you bought and why.
Keep a long-term framework
Set a position size that fits your overall finances. Separate money needed soon from money exposed to market swings.
Review your portfolio when your goals change, not only when prices move. Ask for product-specific information before making a decision.