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Thread: Tips To Maintain Financial Security While Investing

  1. #1

    Default Tips To Maintain Financial Security While Investing

    There is hardly anyone who is unaware of the benefits of trading in various financial markets. Financial markets hold potential to earn profit. But not many people succeed in the market and there are many who restrict their investments to safer yet low paying investment option. This is because there have been many instances where investors were expecting decent returns when the market crashed and they were pushed to the edge of leaving the market.

    Although investing involves a reasonable amount of risk taking on the part of investors, in most cases it is financial mismanagement that leads to bankruptcy rather than market risk. There are many misjudgements that trap the investors into financially difficult situation. Here are two main points that investors should keep in mind.
    (Information credit: EasyMarkets)

    1. Create a Strong Foundation before Investing
    It is often seen that many people think about working their money to grow it. These people start planning to make investments in trading markets without even without groundwork. Investing requires some preliminary preparations to ensure that you are not vulnerable to rough financial situations that may arise from the dynamic market moves. All you need is little of self evaluation and little amount of safeguarding to be investment ready.
    Here are ways you can create a strong foundation that supports your investing activities.

     You must first start with a self-evaluation. You must check out how much you earn and how much you spend. Apart from that, you must also evaluate your risk taking capacity and capital investing capability.
     The next step is to cut out on all the unnecessary expenses. You must also think about improving your income. This will help in strengthening your financial condition and will allow you to invest without any fear.
     If you want to invest in the market, you must think of paying off all your high-interest debts and credit card bills. This is because you cannot invest freely with the burden of paying off debts on your shoulders.
     To become a successful investor, you need to inculcate good habits like allocating a sum of your money for health and other types of insurances. Once you have a protective cover, you will get more confidence to invest in the risky market.
     You must maintain an emergency fund to help you in all uncertain situations. This acts as an assurance even if what you expected from the market does not happen.

    2. Invest Wisely
    Investors are so convinced by a marketís profit making potential that they jump into investment without considering some of the basic investment aspects. You must understand the market well before investment. Every market is a sea of opportunities for investors who can make the most of it. But every market might not be suitable for you. You need to choose a market that fits your investment needs.

    You must also understand your investment options. Understanding the basics of stocks, metals, forex, commodities, etc. and the different ways in which you can invest in these markets like indices, ETFs, gives you the chance to identify the right opportunities. It also helps in reducing the risk.

    These are some of the points that investors should keep in mind in order to get rid of the chaos cause by misjudgement and mismanagement. If the investors have a strong base, they can avoid losing everything in market.

  2. #2

    Default

    Only know if you have 100,000 to invest and get 5 % return, you get 5,000.

    If you leverage to 500,000 and it becomes 1,500,000 in 4 yrs, like that I don't know how to count.

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