7 Tips for those wishing to Start a Successful Investment
Whether you want to invest in stocks, currencies, precious metals, or any type of investment, you must be aware that obtaining returns from investment is not always guaranteed, and that there are many risks associated with investment.
The first step for anyone who wants to start investing
Familiarity with the basics of investment and understanding them well is the first step for those who wish to enter the world of investment. In order to achieve investment goals and make wise investment decisions to avoid the investor falling into risks, he must be aware of investment mechanisms and types.
Investing is defined as the process of employing money in order to obtain financial assets, which the investor buys with the aim of achieving a return based on expectations of either:
increase in value over time.
Or it will provide a new source of income.
Or achieve both, its value increases over time, and it provides a new source of income.
People have different goals for investing their money. For example, there are those who wish to provide additional income in the future to secure the necessary needs that they may not be able to provide if they do not invest their money, and there are those who invest their money in a desire to compensate for the bad effects of inflation on their savings (their purchasing power decreases) over time.
If you intend to enter the world of investment, you must realize that there are no guarantees of profit always in investment, meaning that the value of the invested capital is subject to decrease as it is subject to increase, especially if it comes to short-term investments. The good news is that there are many ways that enable you to reduce the risk of falling into investment losses, but of course it does not guarantee that you will avoid these risks completely.
Among the best ways to reduce risks is to raise your awareness of investment mechanisms and its various vessels (stocks, investment funds, real estate, companies…). One of the things that raises the level of expectation for achieving the desired results is that you are familiar with the working mechanism of the local and global markets.. The more you know about these mechanisms, the higher your ability to seize investment opportunities, and the higher your ability to avoid risks.
When you become more informed and familiar with investment mechanisms and types, the time is right to choose the field and types of investments. But before you actually start investing in a specific field, you must first study this field and understand all its aspects well.. How do buying and selling operations take place? How do you achieve the desired profits? What is the highest percentage of expected risks? How do you avoid it? Be sure to seek the advice of experts in this field only, provided that there is an element of trust, and do not derive your information only from brokerage firms, as most of them show the bright side of the investment process, but may exaggerate greatly to tempt you, and this is normal, as they do not care about your interest as much as they are interested in achieving their own goals.
7 tips for starting a successful investment
The following are seven tips for successful investment, which are the most important, according to expert opinions. Try to follow them as much as you can in order to achieve the growth of your investments:
1. Invest in a field when no one else wants it
The first of the seven pieces of advice is to follow the famous advice of one of the world’s richest men, Warren Buffett (whose personal net worth was estimated at $50 billion in 2008), which is to “don’t follow the trend.”
She explained that this advice is to invest in a field when no one else is interested in it, so you should not buy what is popular and desirable and try to do well in it, as the general public does when they want to invest in stocks when everyone invests in them. That a particular stock is desirable or brings gains to its holders does not necessarily mean that it is a good deal to buy.
Within the first advice, the study stressed the importance of the investor following and observing the market carefully and carefully, and merging his research and ideas with expectations, because blindly accompanying the choices of major investors, market trends and analysts may be a very dangerous idea, noting that there are popular stocks and investments that can be bought when they are ready to fall. In this case, the chances are not as good as they seem at first glance.
2. Find good companies going through bad times
According to the study, the second advice is to look for good companies that are going through bad times. The company may be going through a temporary stage in which share prices fall due to an emergency event, but since the company’s financial position is good and based on solid foundations, there is a great chance that the shares will rebound and return. to rise gradually.
The study demonstrated the validity of this by what the CEO of the global “Apple” company, Steve Jobs, did when he returned as CEO of the company for the second time in 1997, and above that the company was suffering from serious problems (it recorded a net loss of $ 161 million in the fourth quarter of the same year). And thanks to his vision and continued launch of some successful innovative products, Apple’s net profit rose staggeringly to $4.31 billion by the fourth quarter of 2010, indicating that investors who took the opportunity to buy stocks at low prices when Jobs returned to Apple in 1997 They made big gains unless they decided to sell too soon.
3. Be patient and invest in the long term
For his part, Al-Halyan said, “The third advice for those who wish to invest is to be patient and think in the long term, because patience is the key to success in investing, and investors should not expect immediate profits, and their investment should often be long-term,” explaining that ” In the case of (Apple), investors have been waiting for more than a decade to get the huge returns, and when some sold quickly to get a good profit, they missed out on the opportunity to achieve more gains, because they were not aware that stock prices could continue to rise. Height”.
4. Don’t put all your money into one investment
Al-Halyan added, “One of the common mistakes of investors is (putting all eggs in one basket), so the fourth tip for investment success stressed the need not to put all the money owned by the investor in one investment field, meaning the need to diversify investment.” He emphasized that «the investor should build a good investment portfolio to protect his investments from sudden crises by diversifying investments and distributing them in several areas, in order to avoid risks by reducing dependence on one field», pointing out that «during the recent collapse in global markets, investment fields were not They are all just as bad for many reasons. While real estate stocks have suffered greatly, pharmaceutical and product stocks have suffered Rapid consumer stocks only marginally declined, while technology stocks rose due to their outperformance in new product innovation.
5. Define an investment plan and work hard to achieve it
According to the fifth advice mentioned in the study, the investor must build an investment plan and work diligently because without a good investment plan, a strong portfolio or a strong understanding of the markets in which the investor operates, he will suffer in order to reach success, stressing the importance of the investor remaining well-follower of the state of affairs. the current market, and to develop a good investment plan commensurate with clear goals and objectives, using the guidance of experts and their opinions on the plan, but on the condition that the investor does the work himself through research before he gets involved in large investments.
6. Do not get involved in investing with borrowed money
The study warned that the person who wants to invest should borrow or invest in what he cannot afford, and indicated that it is necessary to follow the rule that you invest only from money that you set aside for the money that you need in your life and for your family, so you should never rely on an investment to pay bills or Any of the necessities you have in life, and she indicated that the interest on a personal loan or on a credit card from which money can be withdrawn to start investing is imperative to be repaid, while the profit on investment is an exploitation of borrowed money is not, as the loan interest may sometimes exceed the achieved return. .
7. Use the experts to help you make the investment decision
She stated that there are many other investment keys that those who wish to invest should study them in the field of investment, so he does not have to do it alone, and he can seek the help of specialized financial experts and advisors to help him make the right investment decision, pointing to the possibility of using a team of Specialists in various fields of investment, by communicating with the website to build an investment plan and exchange opinions on investment opportunities.
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