Essentials for making an investment portfolio

Investing is not a game. Not for the faint of heart. Stock markets move up and down. You can’t just predict the market. Its movement cannot be predicted. Therefore, time cannot go up and down. You can build a solid portfolio to possibly be successful. Few considerations to take into account.

Invest with one goal in mind: As discussed in one of the points, the purpose of the investment must be taken into account. Even before you start investing. One must know how much it will cost to achieve that purpose. Purpose shows the way to investment. Always correcting it when the investment gets out of the way. Yogi Berra, a wise baseball philosopher, sums up: “If you don’t know where you’re going, you’ll miss it all the time.”

Your current situation and the risk you can take: What is the current financial situation? How much has been earned and how much has been saved to date. In future date what will be the need. How much income should there be to save enough to meet the required goal?

If savings are insufficient, then that savings should be channeled into investment. Then the quantity will increase in the shortest period. When investing enters the scene, the issue of risk comes up.

Every investment carries risks. The level may vary depending on the type of investment. One extreme is high-risk takers and another extreme is risk-averse. This depends on the nature of the individual and the circumstances.

With risk comes reward. High risk, big rewards. Low risk, low rewards. Usually individuals take the middle way. Medium risk and medium rewards. One can take the help of the best tip sharing provider to alleviate the situation.

Purpose: There must be a defined purpose or objective for the investment. It should be personal like a vacation abroad or buying a house or marriage or education or retirement or whatever. Once the purpose or objective is established, the next thing is to establish the time to achieve it. It can be a week or a month or a year or a decade.

For example, going on vacation to Europe next summer. The purpose here is a vacation trip. The duration of time is 2 years. What do you want to do and when? Get nifty tips for the future, free two-day trial.

Quality, not quantity: In the long run, it is the quality that lasts, not the quantity. Whatever the components of your portfolio, make sure it maintains quality. Because one’s possessions are critically important.

Diversified investment: the portfolio should not be randomly placed. It must be supported with proper planning. It should be done after considering the fundamental and technical aspects of the securities.

The portfolio should be diverse across all sectors (IT, banks), cap industries (small, medium, large) (cement, mining, pharmaceutical), bonds, fixed deposits, provident funds, precious metals and stones (gold, diamonds ), MF, real estate, geographic regions, commodity tips, etc.

Here too the risk tolerance of the investor must be taken into account. Some investments are risky in the short term but not long term. There are many stock market advisory firms that can calculate the associated risk.

In stocks, you should look for cash flow, product, earnings, dividend history, management, place among peers, etc. of the company.

Current market shares can be expensive or cheap, depending on the current political environment, supply and demand, etc. Buy only ‘A’ quality listed stocks.