There are numerous things that you invest in your daily lives.
You invest your time with working on your job.
You invest your energy with your hobbies and interests.
You invest your feelings and love for your loved ones and you invest your money to where you feel will give you good returns.
When we invest something, we expect a certain amount of return to it.
You work to have your salary and therefore when you invest your money, you hope to be rewarded with a decent amount of returns.
However, before we invest our money, it is imperative that we review our objectives first.
I am not a fund manager who is going to tell you where to put your money but I am here just to make sure that you make an informed decision before you invest your money.
After all, that's the main purpose of this blog.
These are the few pointers you should take note of before investing.
•Have the proper mindset to investing If you are investing just to make a quick buck based on peer recommendations, you are actually gambling your money away.
Research thoroughly or seek consultation from those who are familiar with your mode of investing.
•Have a price target-(knowing when to get out) Many people who invest are only concerned on the entry but few thought of the exit.
The entry does not determine the return, the exit does.
Exit too early and you might lose potential returns, exit too late and you might dive into negative territory.
•Have an exit plan Ask yourself what would you do if things are not going to plan.
Stick to it.
Do not hesitate to cut losses early if the future is unclear.
If you wish to hold the investment, decide on a suitable time frame that you are willing to allow the investment to run before switching to something else.
•Do not attempt to time the market Many a time, investors attempt to time the market.
There are several different approaches to timing the market.
One of the most popular one is to wait till the economy has fully recovered.
A point to always remember, the economy is the economy.
The market is the market.
They anticipate each other.
Therefore you might be buying at the peak should you get your timing wrong.
Less room for error.
When everyone is in it, you are buying at a high price.
•Review your Investments Do a review for your investments at least once a month.
Too often, and you will be greatly affected by the short term fluctuations of the market.
If you want good returns from your investments, you've got to spend some time reviewing it.
Most will let their investments dwindle and turn into an irrecoverable loss.
•Do not involve yourself with crowd behaviour.
Warren Buffett once said "be greedy when others are fearful and be fearful when others are greedy".
Doing that and he turn himself into the world's richest investor.
•Educate yourself Nothing beats a solid foundation in your investment education.
Read more books on investing.
Join seminars on financial planning, most of them are free.
I've been to some of them and they proved to be fruitful.
You always learn something knew.
Plus, you get to make new friends! I cannot emphasise more on having your objectives right before investing.
Do not for once invest with borrowed money no matter how sure you know you're going to be profitable.
There is no sure thing in investing or else every one of us would be millionaires.
Risk always exist, but it's what you do to minimise it that will prove beneficial for your investments in the long run.