Investing Tips & Advice
This is what I have learned as an Investment Consultant for more than a decade. Some important tips for every capital investor.
General Investing Tips:
1. The Investing Triangle
Imagine that investing is like a triangle formed by three main axes: (i) return, (II) risk and (iii) time.
Whenever you push one of the three axes, the other two will have to expand. Therefore, if you wish to have great returns then mathematically the incorporated risk becomes higher and the timeframe needed to achieve these returns becomes larger.
TIP: Trust no one who promises high returns with low risk in short time-frames.
2. The Relation between Return, Risk and Time
Don’t focus entirely on your investment future returns, focus equally on the incorporated risk, and the projected timeframe. Balance always your investing decisions between these 3 factors and you will be rewarded. If you ignore time you will probably get bored while if you ignore risk you will probably get bankrupt.
3. Portfolio Diversification -The Golden Rule of Investing
There is only one rule in Investment that can be mathematically proved true. That rule is portfolio diversification. Don’t put all your eggs (investment positions) in the same basket. Differentiate your investments in different industries, different types of investments, different currencies, and even different economic zones.