Monday, November 12, 2012

What Investment Decisions Require

To make it business of whatever kind you have in mind you must take a bold step of making an investment.

What Is Investing?

To invest simply means buying an earning asset. Assets that can produce an income stream for you and put money in your pocket. It is a process of being proactive about where your money works and how much it earns. Investing is not a way to get rich overnight but a way to sleep while your money grows.

There are certain questions that needed to be asked such as:

What type of investment is better-Physical or Financial?

What can be considered as the best investment?

What obstacles are preventing investment?

What type of investor are you?

How do you handle risk?

To determine the kind of investment that is good for you there is the need for proper assessment of who you are in terms of your capacity and God-given abilities. If you know You have the drive for trading on physical goods (tangible commodities) then, you can settle for physical investment in commodity market. On the other hand if you are a busy fellow that can not sit in a spot for business activities it is better you go for financial investment; investment in financial instrument like bonds, shares and stocks of viable companies and the likes.

What an individual considered as best investment is a thing of the mind .It depends on your initiatives and experience over the years. For you to always come out successful in a Business you have to re-invest or plough back profit into a profitable business. A business you can bank on anytime any day as a cash cow. Never leave this kind of business amputated for a new, never tried, kind of a business in the name of diversification of portfolio when you have not realized a reasonable profit that is more than enough to cater for at least three new projects. I mean make it a 3:1 before diversifying your portfolio. You have to know that experience is the only teacher. It is better you might have made 300% profit in your first line of business before you try another with a fraction of your profit. Let that business fend for others.

Your nature has an important role to play in your investment decision. According to experts there are three types of investors viz:

1. Risk lover

2. Risk averse

3. Risk indifferent

You have to know where you belong to determine the kind of risk you are going to take. Remember the higher the risk the higher the returns on investment.

Handling of risk depends on your goal, the purpose of investment and your personality.

Watch out for obstacles preventing investment and a detailed write up on each problem.

He is an Economist, Internet Marketer and a Business consultant he loves creating wealth, building Businesses and Investing in a profitable ventures. Visit my site http://www.dollarfloodgate.blogspot.com to discover the amazing secrets to a profitable online ventures.

No comments:

Post a Comment