In is necessary for every one who wants to become an investor to set a strategy. According to this strategy, he can think about a portfolio and also he can decide tactics for buying the shares. He will also be able to set for how long he will be keeping or when is the perfect time to sell the shares. Without a strategy, people will invest at random and will have no clue about how he can reach for efficiency and productivity.
For example, if a person decides to sell stocks every time the market is slumping, it will be difficult for him/her to reach his goals. Long term success of investments depend on the financial instruments people chose to work with. Financial consultants agree that investing strategy is crucial when they suggest the perfect investments. Before investing anything, a person should analyze his financial situation and set clear objectives: how much money should they save for utilities?
How much money should be saved for unpredictable expenses? Which is the amount of money that should be saved in order to reach the goal: buying a house, buying a car, ensuring extra money for retirement? Mutual funds are usually chosen to achieve different financial goals. In some surveys carried out abroad, over 80% of respondents confirmed that they invest in mutual funds to supplement the incomes of retiring. First step for making an investment decision is to set a goal.
Each person can decide how much he wants to invest and for how long he will be keeping money in the Fund. For example, if he wants funds for retirement period, then it is a long-term investment. Depending on this chosen period, there is a risk that can be assumed. can be established. As a general rule, the longer this period is , the major risks can be assumed. Short term investments require a more careful approach.
A higher risk will always offer the possibility to gain extra yield.
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