Investment field has changed a lot in the last five years but mostly in the last 2 years. Now, many youngsters are coming forward to participate in the market. Digitalization has revolutionized the world of investing. Now at single place you can monitor all your investment and manage accordingly. Companies are working more and more to attract
customers with their eye-catching marketing skills so it is more important to not fall victim to any such scheme which can ruin all your profits at once. It is always said that you should be more aware about any investment product details before diving into it. Here, will discuss with you that how you can avoid such mistakes in investing and what should be done to make your portfolio hassle free.
Don’t be in hurry: always take time in studying about market investment scheme before opting it. Always gather as much as information you can get about it. You can ask whatever question pop up in your mind. Don’t fell hesitate to ask anything related to the investment document. It is your advisor responsibility to satisfy you on every ground. If you are thinking about any of financial goal that will be fulfilled by it or not, ask him/her straight. Even though if you already have bought the scheme or any insurance in hurry and later you realized that
it is not good for you then you can return it to the seller within fixed time duration, in most cases it is within 15 days after bought the scheme.
Plan for longer duration: When you are buying any asset or stocks of the company, make it for the long period like 10 to 20 years, or you can keep it with you unless you don’t need any money. Short term gains are not likely to occur always if you watch the history of stock market. On the contrary, let’s talk about stocks of MNC’s like GOOGLE, APPLE, NESTLE, BRITANNIA etc. and many more. These companies have given unexpected returns to their shareholders on long term basis and trend will continue like this. while buying any stock or mutual fund, consider looking into following things.
1. Balance sheet of the company
2. Business of the company and its future plans for upcoming 10-15 years.
3. How the company generates its income.
4. Past performance of the company.
Diversification: “don’t put all your eggs in one basket” surely you heard it somewhere. This implies much in investing field. There are multiple investment options available and all carries different risk parameter. Whatever amount you plan to invest monthly or annually, put that in several other options as well. Anyhow you are putting your money in the market, no matter how much safe it is but you cannot guarantee its success. Every asset reacts differently to the adverse situation of market which makes your portfolio less exposure to risk. How to diversify your portfolio, for this you can consult your financial advisor.
Don’t forget the risk involved: Risk management is considered as the most important part of the investment. All the investment options which are available in the market inhibit risk in themselves like low, medium and high risk. Also, we know that risk is directly proportional to the reward. This works well in real world situation as well but it doesn’t mean, to generate maximum profit you put all your money in high-risk assets like derivatives or cryptocurrencies. These are most volatile assets and beginners should remain away. While investing consider the risk parameter of the asset is most important. Apart from this, risk taking capability of an individual is also different for everyone which plays a significant role in designing the portfolio.
Charges and fee: how we can forget the charges? It is very important to discuss. Nowadays there are many companies which are offering free services and also buying any mutual fund or stock at discounted rate. Its important to look in to it before go for any investment. Like if you want to buy any mutual fund, you can go for direct mutual fund in which expanse charges are smaller than the regular one and on the bigger scale it can save you a significant figure. Also, if you want to buy any stock for any company listed on stock exchange, you can get free delivery into your Demat account.
Control your emotions: Market always moves in up and down positions. This is well known for the financial advisors that when to enter and exit in any trade or when you need to come out when market moved against your speculation. This is what where emotions may lead to lose your entire amount. If you have made any investment and at the same time market reverses its direction than it creates panic in the customers mind and in the fear of losing all money, they come out of it at small loss. This type of situations always occurs. if you have faced the same situation than it can create fear in your mind and which can throw you out of the market for ever. Don’t try to follow this kind of practices, always keep your emotions aside while making investment. Always do some research before that or take advise from advisor.
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