Top 5 Tips For Those Who Want A Profitable Investment

To achieve your investment ambitions, there are deliberate steps that you must follow in order to avoid loss and reap the targeted profits, and financial experts say that the most important thing is to preserve the money and not to develop it, and the intent is if you decide to invest and your financial assets are exposed to loss, it is first to preserve these funds instead of investing them without consciousness.

Most investment experts confirm that the study of risks is one of the most important reasons for success and investment development.

The US Securities and Exchange Commission advises those wishing to invest - in an article published on its official website - with a number of tips, the most important of which are the following:

1- Clearly map your financial goals

Before making any investment decision, sit down and take an honest look at your entire financial situation, especially if you haven't made a financial plan before.

The first step to successful investing is to define your goals and take risks, either on your own or with the help of a financial professional. There is no guarantee that you will make money from your investments, but if you get the facts and information about saving and investing and follow a smart plan, it is only natural that you will be able to get financial security over the years and enjoy the benefits of managing and growing your money.

An integrated investment plan should include 5 basic dimensions: retirement, income, investment size, taxes, and risk ratios.

2- Assess your ability to take risks

All investments involve some degree of risk, so if you intend to buy securities - such as stocks, bonds or mutual funds - it is important to understand before you invest that you may lose some or all of your money. Unlike deposits in banks that are insured by responsible government agencies, the money you invest in securities is usually unsecured, you may lose your principal, which is the amount you invested even if you purchased your investments through a bank.

The reward for risk is the potential for a greater return on investment. If you have a long term financial goal, you are likely to make more money by investing carefully in higher risk asset classes, such as stocks or bonds, rather than making your investments on lower risk assets.

On the other hand, the main concern of individuals who are in securities is inflation risk, which is the risk of eroding returns over time.

In a report written by Barry Spencer - on the Kiplinger website on investment affairs - he pointed out several factors that help investors in the long term, the most important of which are the following:

3- Investing in high quality companies

Because of inflation and expenses, your money needs to grow in the long run. Achieving the desired profit depends to a large extent on achieving a steady growth of investments, so investors have to invest a certain amount in stocks.

Investing in high-quality companies can build investor confidence in the long run, because the investor knows what he has. Time has shown that the right and sustainable investment approach can be centered around focusing on businesses with sustainable competitive advantage, strong management, and fair value for money.

4- Let planning help you make decisions

An effective investment strategy goes beyond what is in your portfolio and percentage return. In fact, most advisors do not do integrated planning, which causes them to miss opportunities to maximize and achieve investment efficiency.

An integrated investment plan should include 5 basic dimensions: retirement, income, investment size, taxes, and risk ratios. For this reason, it is worth reviewing your investments at regular intervals to ensure that you are taking advantage of the income and investment opportunities that may be available to you.

5- Don't give in to quick reactions

Stop following mainstream financial newscasts and random Google searches, as they are meant to provoke fears in order to attract viewers and readers. If you listen or read a lot of negative financial news, there is a good chance that you will end up making an unwise decision about your investments. Instead, let the media's curiosity lead you to seek personal advice.