The following are some great investment tips. New or refresher, before you start spending your money, these investment tips can get you started on the right path towards greater wealth.
Invest in what you Know
When you hear investment tips, you will often be told to invest in one you know. This is because it is a very smart rule to follow. This means you should never put your money into anything unless you fully understand what you are doing and you know all about what it is.
For example, if a friend tells you about this great company that is selling stock and all you know is that the firm sells something in technology, don’t buy. At least, don’t buy it until you’ve spent many hours understanding the business and understanding what they do. If you still can’t figure it out, stay away.
Frequent investing is a great way to take advantage of dollar cost averaging. If you buy the stock all at once only one time per year, you are sacrificing a lot that you would get by investing once per month or more frequently.
First, if you are saving up money and leaving it in a bank account, you are giving up all the gains you could be getting in that year. Second, by investing equal amounts more frequently, you get more shares at a low price and fewer at a high price. The main idea is to get the lowest purchase price possible, and this will help you out a lot.
The more money you invest, the more money you will make. This is a simple investment tip that could make a million dollar difference. If you invest $10 a month, you’ll have a lot more money in 30 years, or you can invest more per month and have a lot more money in much less time.
Try to sacrifice things that you don’t care much about now instead of sacrificing your time. In the years to come, you will be very glad you did. Start by increasing your contributions by 10% and see where it goes from there.
Monitor your Investments
Never buy shares of stock in a company and forget about it for five years. The same goes for other securities. Don’t check the prices every 10 minutes, but you will need to find a comfortable medium.
Also, monitoring your investments doesn’t just mean watching the prices now and then. You have to continue to research on a regular basis and watch the company itself. Take this step and save yourself a lot of pain and money.
Practice Investing for Free
Great investment tips must include the benefit of practice. Getting your hands wet in the markets is a must if you want to learn and do better and better. If you aren’t ready to start investing real money or you want extra practice with taking risks, start with a free stock market game. You can sign up below.