Here's why you should rethink classic investment proverbs

During a bear market, when prices are falling steadily over a longer period, you'll often hear investors warning not to try 'catching a falling knife'. But how do you know when the knife has hit the bottom? Photo: Frank Rumpenhorst/dpa

Sometimes it sounds so simple, playing the stock market, given such advice: "Don't put all your eggs in one basket", "Holders of interest-bearing security sleep soundly", or "Buy shares, then take a sleeping tablet and when you wake up you'll be rich". These and many more investment "tips" exist, the question is, how reliable are they?

For Jessica Schwarzer, a finance journalist and author, such adages are always a source of joy. "Those are often pithy sayings from well-known investors who describe the stock market in flowery terms," she says, naming two internationally famous investment gurus, Andre Kostolany and Warren Buffett.