How To Invest
If you are looking for a way to make your money work for you, learn how to invest it. This crash course in investing is perfect if you are serious about implementing techniques that actually work. Read all of the tips below on how to invest and use them in your financial decisions.
- It's all about defense. Everyone invests to make money and you can't make money until you stop losing it. The number one rule in investing is: don't lose money. If you can begin to not lose money, you will make money by default.
- Invest for value. A great way to invest is to buy things you know are worth a lot more than you pay for it. This way you know you have a built in cushion. If the price of what you buy drops a little you can still break even or sell it for a profit.
- Earn residual income from your investing. Invest in an asset that will bring you royalties or recurring earnings. This is like making money on auto pilot; even when you are asleep you will still be raking in the cash from your investment.
- Use effective hedging strategies. With a lot of investing instruments, like stocks, you can hedge them with market derivatives such as options, bonds and other secondary market securities. Hedging will protect you from a volatile stock market and is like a principal insurance.
- Invest in what you know. Stick to investing in what you know about. Don't invest in a market just because it looks like it is making money; know that it will make money for those who know the market well, and not necessarily as well for a novice.
- Don't die without life insurance. Make sure you help your family after you die as you did when you where still alive. Your family will appreciate the protection, as well as the generations after, depending on how much you left them.
- Look for things that have intrinsic worth. In other words: don't invest in something long term because it is hot now. Make sure that the item itself has true real value and worth. Trends come and go, but real value lasts.