Even though the stock market can be an area of uncertainty There are tried-and-tested strategies that can increase your chances of long-term success.
The first thing that any investor must do is define their financial goals, for example, saving for retirement, buying an apartment or financing your children’s education. That will help them determine the amount they should invest in the market and what kinds of investments would be appropriate for their particular situation.
It’s also recommended to put a priority on building an emergency fund and paying off debts with high interest before putting your money into the market. If you do have funds to invest in the market, start with a small amount and gradually increase your investments as you gain experience.
Keady clarifies that one the biggest mistakes made by beginners is trying to predict the market. « Nobody knows the perfect time to invest, » she adds, noting that the best strategy is to commit to a long-term investment and stick with it even through rough patches.
When you’re beginning your journey, you should focus on stocks of companies that you are familiar with. Peter Lynch, the legendary Fidelity Magellan Fund manager, once said that you stand a higher chances of success if you invest in companies that have a solid track record and growth prospects.
Avoid online forums and adverts that promote stocks with a high probability of success. In many cases, these are part of a pump-and-dump scam where shady investors purchase buckets of shares in a tiny firm to boost the price and then dump their shares to line their pockets.
