At one of my recent investment seminars, a new investor asked me what mistakes he should avoid. This is my list of the five biggest mistakes investors are making right now:

• Buying bank stocks for their big dividend yields.
• Averaging down in money-losing stocks.
• Confusing short-covering in financial stocks with a real rally.
• Not own A-rated stocks with strong sales and earnings growth.
• Not understanding that P/E Ratios are now at an 18-year low. After the third- and four-quarter earnings come out, P/E Ratios could fall to a four-decade low.