Monday, 14 October 2013

5 Recommendations For Developing a Reliable Investing Strategy

As a smart investor, you know that short-term emotions can influence decisions that are not in the best interest of the long-term success of your portfolio. If an investment provider cannot explain their offering to you in understandable terms, you should be very skeptical. Truly dependable investment advice should be comprehensible to a 10 year old. With that being said, never invest with just your "gut-feeling." Take the time to learn about investments before investing, and use the valuable information that you have collected to focus on these 5 recommendations for developing a dependable investing strategy:
  1. Invest in a manner that aggressively fights inflation and prepares for longevity. Do not be overly conservative with your asset allocation. Even if you manage to save plenty of money, it is possible you may lack the purchasing power growth to match it.
  2. Carefully consider all investing factors to accurately determine your true risk tolerance. You must consider your ability, willingness, and need to take on risk. Ability: based on time frame. Willingness: measures the amount of volatility you can accommodate.
    Need refers to the level of return required to meet your spending goals.
  3. Determine if you have the financial resources (and stomach) to endure the worst-case scenario. If you have an investment that drops 50 percent, how much do you have to earn back, just to break even? Surprisingly ... 100 percent.
  4. Your financial health relies upon the proper balance of investment strategies. Never, under any circumstances, should you invest the money you need to maintain your current, base standard of living.
  5. Get familiar with common investment jargon. Just because someone talks like a seasoned investment broker, doesn't mean they have good financial sense or an understanding of how to construct a profitable portfolio.
The fact of the matter is that nowadays, many of the investing secrets that will earn great returns are widely known and are already a part of many investors' portfolios. Why? Because many of today's emerging alternative investment offerings are more accessible to the average investor, and most have steadily risen in popularity by offering appealing investing opportunities for members of the investment community, who are legitimately concerned about their appetite for risk and long-term financial health.

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