Investment never has been an easy game. Currently in the times of economic crisis the channelization of investments are particularly risky due to the volatility of the markets. It doesn’t suffice if the money languishes in the accounts, exactly when your money works for the banks. Our money should work for us rather than the banks who pay meagre interest on the cash they hold for the depositors.
Savings are what is left after expenditures. It is important your savings
do not languish in those bank accounts but begin working for you. Investments are the best way to play dynamic and gain returns. How exactly should you invest is the hard question where many early investors lose sight and fall into the wide chasms stuck between gains and losses .
To play safe in the markets, adoption of portfolio investment
strategies are the key . Portfolio investments are made to escape uncertainties of investments.Until the 60s the financial advisers around the world took up strategizing risk returns trade offs by analysing and picking exclusively the cash cows. Savings that are invested are usually those savings which have been accrued over a period of time. Thus the transition of savings into income has to be intricately detailed with vast benefits garnered in the long run. Portfolios have to be created using the stock index over a wide-ranging survey of many listed companies. Zeroing down to the portfolio of maximum returns vis-a-vis risk is the portfolio that has to be invested in. Risks can be predicted when the investor has a good knowledge of political and economic turbulence around the world as these are what realise , mainly , the rigidity of the gainful returns.
Investments are made in a composite fashion as any incurred loss cancels out against the gains made thus balancing and giving a robust base against risk but it is fairly irregular in the current market trends
to analyse as the economic downturn
will hit portfolios harder than the model prescribes. Concurring down slides gives no chance to the composite portfolio mechanism to balance the odds against the evens. So to call for investments in assets such as gold or real estate is the best bet currently. Investment in wealth
creation other than equity share holding
during the recessive periods is better as the recession hits business and is only applicable to business and economy of the country, that is, the wealth side of the economy remains undisturbed which makes it the safest investment.
It is important that the savings are accrued before investing. Small amounts are best saved in the banks rather being invested in the markets as they will be more subjected to volatility. Although investments are to fetch gains in the long run , those gains will be invested in wealth creation. Recessive tendencies when read by a sound aware mind, investment in wealth assets is the top seed. So for the portfolios it is always the trend of market that has to be analysed than the value of the share. Markets operate furtively, and if not analysed they sure will break the expected returns
. Hence stands the move for wealth creation over stock holding in recessive and depressive periods.
Article contributed by “THE IDEA BUCKET” team-member, Mikky.
©THE IDEA BUCKET, 2012