Top 10 Investment Tips for Beginners



If you have just started your career and are looking to invest a part of your income then you are on the right track. However, being a beginner, you must be wondering where to start. With so many options available in the market, choosing the one that suits your requirement can be daunting.


Here are 10 tips that will help you get started.


1. Start early

It is always a good initiative to start investing early in life. You will need less money to achieve your investing goals if you start investing early. Over time, your earnings will compound which will prove to be a boon. So, don’t hesitate to start investing even a small amount if you are a college student.


2. Set your financial plan

Making money is the ultimate intention of most people. However, everybody’s needs are different and you must have a financial goal in place before you set out to invest. You will have to consider your age, income, personal circumstances, capital appreciation, financial position and safety of capital.


3. Consider your finances

Before you start investing you need to understand your financial status. You will have to be realistic about it. While setting aside a part of your income for your investments, you must make sure you have enough money to pay for your monthly bills, loan payment, etc. Although you don’t need a lot of money to get started, there are risks. You will have to consider the risks associated with your investment. Understanding the market thoroughly will help you assess the risks and make an informed decision.


4. Know your risk appetite

You must analyze the investment area before you decide to put your money in it. Compare the different investment options available and also understand the level of risk associated with them. Evaluate the risk you are willing to take and accordingly take the investment decision. Avoid investing in instruments carrying a high probability of incurring losses if you have low-risk tolerance. Risk calculation also helps you know the right time to make the investment.


5. Have a diverse portfolio

The market is highly volatile and prices may go up and down according to situations. To ensure that your investments are safe and you do not suffer losses, it is imperative that you have a diversified portfolio. You will end up having some stocks that are rising when others are falling. You may also consider investing in overseas markets as well since they are notably different.


6. Study your own portfolio

It is important to study your own portfolio. What is right for you today may not be so tomorrow. Therefore, it is important that you are aware of what you have and where you can make any changes in the future. Also, be prepared to make changes in your investment whenever there is a change in the economy.


7. Control over emotions

As mentioned above, the market keeps fluctuating and you need to have complete control over your emotions. The market sentiment towards a company depends largely on the price of its shares. If most investors are apprehensive about a company’s prospects, the prices of stocks and shares of that particular company may reduce. Similarly, when investors show confidence in a company, the prices of its shares and stocks are likely to increase.

In most cases, the condition of the market is influenced by rumors, speculations, and emotions rather than assets and management or systematic analysis of the company.


8. Make your investment automatic

It is recommended that you set aside a certain amount of money every month to be automatically directed to your investment. This will help avoid stalling and at the same time invest consistently.


9. Keep informed

It is always a good idea to know about what is happening to the market. You must read up on things that you have invested in. You may also look for resources that help you understand the latest market trends and the global economy.


10. Avoid any speculation or leverage

Although the idea of leveraging(borrowing funds and investing in stock markets)is lucrative when the share prices rise, you will lose your leveraged money when the prices fall. Additionally, you may also have to pay interest for the borrowed money. As a beginner, it is advisable that you never invest based on speculation. For instance, if you buy a share based on a tip shared, it is speculation and not an investment. Investment is something that you can hold for some time comfortably.


From the above points, it can be understood that beginners must invest their money very carefully. You must not get trapped into the greed of gaining high returns in a short time. You may consider seeking advice from expert financial advisors who can help you get a tailor-made portfolio based on your requirements.

Contact Us

Products
Helpful
About Us
Social
  • Facebook Logo
  • LinkedIn

© Wisely Invest 2018 | Website Designed & Developed by Quest For Tech