Investing is a major part of gaining additional wealth. For people who just starting to invest, can be a little overwhelmed by all the factors you have to take in consideration, while putting your hard earned money to risk. Today we discuss 5 Best Investment Tips we’ve recieved from a highly skilled Senior Lead Portfolio Manager, who manages 6.7 Billion dollars in funds, regarding investing. So you know we’re about to get some exclusive high quality advise. Read on!
Don’t Put All Your Eggs Into One Basket
The first advice I would like to give is the fact that you shouldn’t put all eggs in one basket. What do I mean with this? You should diversify your investment portfolio, don’t focus on one company or sector. First of all start by diversifying over different asset classes, like Equity, Emerging Market, Real Estate, Fixed Income, and Commodities. Within each asset category, you should diversify again. So if you like a particular Stock of one company, you should buy that. But don’t put all your investment money for the Equity asset category in this one company. Create a portfolio of different stocks within different sectors.
No Risk No Reward
With all investment you are taking a Risk. But remember like in live, if you don’t take any risk you don’t get rewarded. So the higher the risk of your investment, the higher the reward should be. If you notice this isn’t in line with each other, you might skip this investment. Your time horizon is also important in this sense, the longer your time horizon, the more risk you can take. So if you don’t need your capital in the near term, then a higher risk appetite will probably lead to higher returns.
Invest In What You Believe In
Always make investments in which you believe in. If you really believe in a product or a particular company, then you should make an investment. Don’t buy Stocks of any other asset category in which you don’t believe in. Try to do some research before making any investment, nowadays you can find all kind of information online. Remember to use several different sources before taking any conclusions.
The financial markets can sometimes be very volatile. Don’t panic by leaving the boat to early. If you truly believe in a particular investment, then you should stick to it (unless radical changes are happening with that particular company you have invested in). Experience have learned in times of high volatility and people panicking, you have the best opportunities to make investments.
Taking Profit Hasn’t Made Anyone Poor
Sometimes if you are making a profit on an investment, take it and leave. Look for a new opportunity. Staying too long in an investment could lead to a loss again, while you had the opportunity to take profits earlier.
These are 5 Best Investment Tips for you to take in mind when making any investment. Good luck!