If you’re already counting your millions, it’s only natural for you to desire to multiply your millions into more millions and hopefully, into billions. But you’ll need to be careful while making those key decisions, so you won’t be referred to as “That man or That Lady that used to be rich”. I’ll be sharing some poor investment decisions that could turn a millionaire into a pauper and of course, how to avoid making such decisions.
Investing Without A Proper Plan
While it’s not enough to find that amazing investment opportunity, without a proper investment plan, you’re about to have a very bumpy ride. Your investment plan should include the specification of the duration of the investment, and the consistent inputs to be made, as the case may be. A lot of people who started investing without an investment plan mostly end up making hasty decisions, and losing out, not necessarily because it was the wrong investment choice but because there was no proper plan in the investment.
Investing Without Considering Your Risk Tolerance
Everyone has a unique tolerance of risks, in other words, there are some very risky investment choices that may not be for you because the level of risk that accompanies it is too high for your stomach. It may even get to the point where you could get ruffled up and decide to withdraw before the time allocated for the investment to mature. You could be reading this and saying to yourself “Of course I can stomach any kind of risks as long as there’s an assured return”, it is easier said than done. While making your investment choices, always be honest with yourself by asking “Am I ready for such risks”?
Lack Of Diversification Of Investment Portfolio
Often when people come across investment plans that seem to be very lucrative, they rush in putting all their resources into it, sometimes they go as far as selling off assets to meet up the requirement, most times because of the promises that accompany such investment plans. Surely there would be such investment offers to you, that could take sleep away from your eyes and leave you fantasizing about the possible outcome, but you have to shake yourself up. Don’t find yourself selling off assets just to acquire an investment. Always be patient to build your investment portfolio, it may seem like you’re slow at making decisions, but it’s better your decisions are always well calculated. Bottom Line, don’t place all your eggs in one basket.
Investing With Emotions
Just as I pointed out earlier, don’t be too excited while making an investment decision, in other words, don’t do it just because it sounds exciting, and whenever you close your eyes, you see yourself inside that yacht with your name written on it, which happened to be the return of your investment in your fantasy. Also, don’t hit back into the market immediately after a loss, people who invest in forex can testify that doing this is a very wrong move. It is understandable that you want to recover what you might have lost, but you must also be calculated if you must do that.
Investing Without Proper Research
As an investor, One wrong move could lead to a huge loss. A lot of people have been misled into buying shares and making investment plans that were falsified. Despite how eager you are to close that deal, always ensure to do your research.
In Summary, investment decisions are pivotal in the turnout of events, therefore they must be educated, conscious and calculated.
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