Essential elements to make an investment portfolio

Investing is not a game. Not for the faint of heart. Stock markets move up and down. One cannot simply predict the market. Its movement cannot be predicted. So you can’t measure time, it’s up and down. One can build a strong portfolio to possibly be successful. Few considerations to take into account.

Invest with a goal in mind: As discussed in one of the points, the purpose of investing must be kept in mind. Even before starting with the investment. One must know what it will cost to achieve that purpose. Purpose shows the way to investment. Always correcting it when investing is going off track. Yogi Berra, a wise baseball philosopher, sums it up: “If you don’t know where you’re going, you’ll miss it all the time.”

Your current situation and the risk you can take – What is the financial position today? How much has been earned and how much has been saved to date. At a future date what will be the need. How much must be there to save enough to meet the required goal.

If saving is insufficient, then that saving must be channeled into investment. So the amount will increase in the shortest period. When investing enters the scene, the issue of risk arises.

All investment carries risk. The level may vary depending on the type of investment. One extreme is high risk takers and the other extreme is risk aversion. This depends on the nature of the individual and the circumstances.

With risk comes reward. High risk, high rewards. Low risk, low rewards. Usually people take the middle path. Medium risk and medium rewards. One can take the help of the best sharing tips provider to alleviate the situation.

Purpose: There must be a definite purpose or objective for the investment. It must be personal like a vacation abroad or buying a house or marriage or education or retirement or whatever. Once the purpose or goal is established, the next thing is to establish the time to achieve it. It can be a week, a month, a year or a decade.

Example, go on vacation to Europe next summer. Here the purpose is a vacation trip. The duration time is 2 years. What do you want to do and when? Get clever future tips, two-day free trial.

Quality, not quantity – In the long run, it is quality that lasts, not quantity. Whatever the components of your portfolio, make sure you maintain quality. Because one’s possessions are critically important.

Diversified investment: the portfolio should not be organized randomly. It should be endured with proper planning. It should be presented after considering the fundamentals and technicals of the securities.

The portfolio should be diverse across sectors (IT, banks), (small, mid and large) cap industries (cement, mining, pharmaceuticals), bonds, time deposits, provident funds, precious metals and stones (gold , Diamonds), MF, Real Estate, Geographic Regions, Commodity Tips, etc.

Here too the risk tolerance of the investor must be taken into account. Certain investments are risky in the short term but not in the long term. There are many stock advisory firms that can calculate the associated risk.

In stocks, you should look for cash flow, product, profits, dividend history, management, place among peers, etc. of the company.

Current market shares can be expensive or cheap, depending on the current political environment, supply and demand, etc. Buy only ‘A’ quality listed stocks.

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