.7 Golden Rules of Successful Investments
7 Golden Rules of Successful Investments
Golden Rules for Every Investor, or Major Mistakes Newbie Investors Make
The number of those who’re new to our business increases every day. Many of them face a number of typical mistakes (step on a rake) of a young investor.
You need to know everything about mistakes to avoid them. Maybe we should start with a start-up capital.
7 Golden Rules of Successful Investments
Rule #1 Constantly Build up Your Investment Capital
Investing requires money, which total amount must constantly grow; otherwise, it cannot be called investing. The source of growth may include both the funds saved up from base wages and the profit from already invested funds (investments).
The figure of 10% of base wages that should be saved up is common in many information sources, but every case is different. Everyone decides how much money he/she can put aside without negatively affecting the quality of life – read more about that in the next paragraph.
Rule #2 Don’t Invest the Last of Your Money
Any kind of investment involves increased risks, so when you invest the last money, you run the risk of ending up with nothing. However, there is something worse than losing the last of your savings (see the next paragraph).
Rule #3 Don’t Invest Other People's Money
There's nothing worse than being in debt to someone, especially when you're a decent person. Investing debt capital is twice the risk, because if you lose it, you’ll have to look for money to repay your debt to the creditor.
Rule #4 Having an Investment Strategy
An investor having no strategy is not an investor anymore, but a gambler. You must have a plan of action (preferably set down on paper) for any possible situation. At that, you unreservedly must stick to it and make adjustments only when the market is closed. Adjusting your strategy “on the go” or in the course of making investment decisions is often caused by various emotions or gambling excitement of an investor.
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