Four tips that every investor should keep in mind
The media and the people on the street do not stop mentioning the words "economic crisis". Two words that undoubtedly scare any investor. But do not rush out to listen, but find out and learn from people in the know. Read this note could be a good start. Here, Chuck Jaffe, MarketWatch, has some advice to give:
Learn and understand their enemies
Most people do not understand how to manage investment risk, so try to avoid them rather than trying to understand them. Thus, when the economy is not doing well, investors are abandoning the stock market.
It is a fact, when harsh times ahead, investors do not buy stocks. This is done to avoid market risk, ie the possibility of losing money during a downturn in the market. But what I do not consider these investors is that when you stop investing your money and puts it to work, it is likely to lose value and lower purchasing power since it is likely that your tickets not keep pace with the inflation.
Thus, the most knowledgeable advise that when an investor feels that tough times ahead, think about how to mitigate the dangers, not completely change the investment strategy. That, as we always say from InversorGlobal, read and learn about the financial world.
Know that your knowledge does not guarantee success
But even reading and informing, as an investor should be aware that even if your main strategy is designed and studied, provided the financial world has a share of unpredictability that makes things more thought having an undesirable outcome.
So it is important that you are always aware and thinking about how to complement and add basic tactics to have more weapons in times of danger.
Know your weaknesses, but not subject
Most investors simply ignore what they do not know or are not comfortable with. That's why their portfolios tend to have similar assets or certain categories with which they are comfortable. They followed to the letter the advice that it is not advisable to invest in assets that one does not understand.
Nobody refutes this idea, what we do say is that if you do not know about certain subjects, you should try to investigate and learn more, if you still find it difficult, that's another topic. But you have to try to overcome their difficulties as an investor.
Hence the importance of knowing your weaknesses well, not to fear them and huirles, but to investigate, learn and be able to overcome them.
Put together a plan B
Expect the unexpected. An investor who builds a bear emergency plan advantage over those who do not have a plan B. Always better anticipate dangers and market cycles leg ahead of these we find the best possible way.
Having read the above, if you are an investor ambitious and determined to make their savings will gain purchasing power, will not remain idle and start seeing what you have to do to perfect his plan
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