Diana Smith
The world of business is full of “financial gurus” who’ll be ready to advise you when it comes to investing. While you might hear some great pieces of advice there will always be quite a few of these you simply shouldn’t follow. And since investing is all about making money, you definitely don’t want to find yourself following advice that doesn’t work. That said, we’ve compiled a list of the best and worst investing advice you’re going to hear.
Advice to reconsider
Always diversify
A lot of people out there believe that diversification is the best way to protect their portfolio. The idea behind this concept is that when some of your investments lose value, the others will gain it. This means that you’ll be protected even in the case if something goes wrong with one of your investments. For example, many entrepreneurs decide not to invest only in blue chips. Instead, what they do is put some of their money in new emerging markets and small-cap stocks as well. However, this doesn’t always have to be a good idea because all of your investments would lose their value in case of a global recession.
Investing in real estate is your safest option
Another piece of advice you’re going to hear is that investing in real estate simply has to pay off. However, real estate isn’t really the fastest growing investment. And if you want to make some money fast, buying real estate isn’t your safest bet. Moreover, terms such as “soaring prices” and “market volatility” are becoming more notorious in real estate, and you might want to think twice before investing in a property. Not to mention that if you want to become a successful real estate investor, you’ll need to put a lot of time and effort into it.
Go for collectibles
There are many people out there who invest their money in collectibles and they’re always going to advise you to do the same. While it’s a fact that collectibles such as stamps, books and works of art are always going to hold their value, investing in them is never easy. This is mostly due to the fact that you need to become proficient at your trade in order to make this work. And there’s no need to say that this can take quite a lot of time. On top of that, the market for these is extremely limited and slow-moving and you might want to take your mind elsewhere.
Advice to follow
Make a good plan
This is a piece of advice you’re destined to hear at some point in your life. And when it comes to investing, it really is a good idea to figure out what you want to achieve and how you want to do it before you start making any bids. Fail to do this and you might find yourself in a middle of bidding war without having a clue about what you’re doing. Not to mention that you’ll struggle to manage all of your investments if you don’t know what you’re aiming at.
Think about buying gold
Saving your money in man-made currencies isn’t really a good idea. Especially when you take into consideration that these are controlled and manipulated by central planners. That’s why people will advise you to invest your money in gold. This is the case because no matter what’s happening in the world of politics, your gold is always going to keep its value. Not only this, but your gold can easily gain value over time, giving you a chance to make some easy profit. Just make sure you turn to the right experts you can buy gold from.
Invest in a mutual fund
If you’re thinking about investing and you want to start small, people are going to advise to start with a mutual fund. Over the years, these have proven to be quite effective when it comes to investing. Mutual funds are all about a large number of small investors pooling their money in order to buy stocks and other securities. What’s so great about this concept is that you and other investors will be spreading the risks. It’s also important to mention that these can be quite flexible since they allow you to shift your investments between different investment assets.
At the end of the day, it’s very important that you understand that not every piece of advice is a good advice. Just keep learning more about the trade of investing and you’ll find yourself on the right track.
