If the stock market always recovers and goes higher over time, why is it that the majority of people (80%) lose money?

The main reasons are because most people make investment decisions based on the short term and not the long term (most people are impatient and greedy).

At the same time, they make decisions based on EMOTIONS and not logic. The two emotions FEAR and GREED cloud rationality. This leads people to make loss-making investment calls.

For example, many people often get caught up in the euphoria of good times amid a bull run, buying even when the market is overpriced (i.e. during the dot com bubble of 2001).

» Read more: Why Most People Lose Money in the Stock Markets