Investing Rules

Investing Rules

Investing is a lot like life. Everyone has their ups and downs, nobody is perfect and everyone gets better with practice (sometimes failing pretty bad at first). In order to be successful, with or without professional help, you must put in the time doing research on your investments. It is important to understand what you are investing, how much you can afford to risk, and what your expectations are for your investments.

Set Clear Goals

This is your most important first step. When you have a clear strategy and realistic goals, it maintains your investing purpose and keeps you levelheaded when faced with adversity. If you do not have an educated understanding of the investing world and are having trouble setting up a plan, seek professional advice from a financial broker or trader. Even if you are looking to invest on your own, experienced advice from someone who understands markets is always an asset. They can also help set up a realistic game plan for your investing goals. Without goals or a strategy, it is easy to lose your investing purpose and snowball bad decisions. The most successful investors are the ones who put in the time to research and set up a strategy.

Educate Yourself

Before investing in anything, you must have an idea of what you’re getting into. The best investors make educated and informed decisions. This will limit your losses and make predictions easier. Pay attention to the experts, but make your own decisions, as investors sometimes lie. It’s a good idea to hear their opinions, as it might change the markets, but make your own decisions. Also, research companies’ income statements and balance sheets in relation to their stock history. These will reveal their true financials and predict future movement. Remember, the best investors don’t follow the upswings, they predict them. It takes more work, but the point of investing is to buy low and sell high. Research for bargains and don’t spend more than you can lose (especially in the beginning).

Show Moderation

Investing is essentially gambling – educated gambling. But it’s important to treat your investments as risk. Leverage too much, and you can lose more than you can afford to. It is also a good strategy to invest small amounts into a large number of investments, instead of investing large amounts into a smaller number of investments. This will prevent losses from being too great. Don’t be discouraged with a bad result. Most investors make the mistake of trying to counteract a loss through doubling up. This is a poor strategy, as more times than not, you will lose it all, instead of getting back to even. If you suffer a loss, lick your wounds, and cash out. Use your freed up capital to invest in something else. As with most everything in life, investing with moderation will ensure long-term success.

Business meeting about investments.

Be Patient

In addition to being knowledgeable and strategic, a successful investor is patient. Seems strange, but when you think about it, you want to differentiate yourself from other investors. Most, when hit with bad news, will panic and sell off their stock, not thinking about future movement. If a fall becomes a bump on the charts and rises back to being profitable, patience will have saved you selling low. If your investment is problematic, take the time to think about your next move. You may be able save some money through a gain-loss transaction. When you hear bad news, it’s already too late. Take the time to plan your next move, and make a smart and conscious decision.

Investogram attempts to provide relevant information about investment options that is meant to be useful, and, aknowledges that the mention of products in this website is no guarantee of performance. Investogram accepts no responsibility whatsoever and reccomends that readers use this site for general education and then consult an investment professional before any purchase.