When every year comes to an end, individuals and business alike are revising their investment, stock and closing the accounting year. As would be expected, some go away with profits, some with losses, and others with nothing to show for the entire year.
And what about you? You may be one of those asking yourself, what did I achieve and how could I have made the year better and to have ended more profitable for me?
As, if that is not enough, you suddenly realize, there is no time to regret, and now is the best time to examine your life, your income and create a list of what to get rid of and what to commit to in the coming year.
For some, it is their weight, others may want to cut down on alcohol, perhaps for you, is to cut down on your spending and start your investment. This is a brilliant decision except that it comes with certain knowledge and skills you may not have at your disposal at the moment.
Don’t panic, there is nothing technical about the information you require to start your investments. All you need shall be discussed in detail in this blog post and by the time you are halfway through you will be ready to start your investment.
With this in mind, we would like to highlight the importance of a good investment. But, to the majority of prospective investors, how to know a good investment has remained an issue and has actually prevented many from investing.
Those who were bold enough to invest either had their investments short-lived or were not satisfied with the ROI (return on investment). We also intend to stimulate you to assess your capacity to invest, what knowledge of investment do you already have, how much investment knowledge and education will you required to start your investment?
These are some of the questions we shall examine as you go through this article. Let’s get it start!
What’s make a good investor?
That is if you are not a good investor no investment will be good. Though there are long-term, short-term, low-risk, and high-risk investments, what determines a good investment is who is making the investment.
Furthermore, a good investment is also premised on the prevailing market and economic indicators. Besides, a good investment is also defined by the investment management team. This is why it is essential for prospective investors to be a good investors before investing.
1. Knowledge is key
To be a good investor, the first thing you should do is LEARN. You can’t run! Knowledge is key here. Good investors are aware of the trends in investments across a wide spectrum of investment opportunities.
Investors are like entrepreneurs, who take risks and must be aware of the dynamics that drive the industry where they intend to operate. Similarly, investors must be conversant with the type of investment being considered.
Before you invest you must have a reason or purpose to start your investment. The reason is that if your investment is a spontaneous isolated idea instead of well-thought-out objectives, as you face challenges along the line, you may not be able to continue with your investment.
Whereas there are several types of investors, investors are generally in three groups, namely, pre-investors (those individuals who are not yet investing), new investors (beginners – those individuals who are starting to learn the terrain of investment), and experienced investors (Active investors- these are individuals that consider their wealth as a business), you either belong to one or the other.
2. Setting goals is a must
Good investors set goals. They also have a plan on how to achieve their objectives. Starting your investment is like starting your business. There are rudiments that will help you to run a successful business.
Likewise, there are ground rules that will make your investment a success. One of them is to set realistic goals. You must not assume any aspect of your investment feasibility study. If you lack expert knowledge in your desired investment, make sure you get the information.
Good investors have a working knowledge of the investment market. They have a workable investment plan and believe in it. They are habitually determined, optimistic, and positive. They are never emotional about their investment and in no rush for ROI. They are consistent with their investment plans and not involved in the cyclical buy and sell quick mantra.
3. Good things take time. Be patient!
Good investors are patient because they understand that investment is like sowing a seed. Certain parameters define your investment which obviously demands determination, patience, and perseverance.
You have to make sure your seed is good such that when you plant it, it will sprout. You need to make sure of the ground you intend to plant your seed. This is the place where you want to invest. If the soil is not luscious, or fertile your seed will not grow.
Likewise, if you do not have the patience for due diligence before investing you may invest in toxic or volatile assets. These will either reduce your ROI or in the worst-case scenario, there are no dividends.
A good investor understands creating sustainable wealth requires patience. Patience is required in all human endeavors and not only in investment. Patience is an essential virtue especially in decision-making and perhaps the best quality you need for a profitable investment decision.
What’s make a good investment?
Were you expecting a list of investments classed as a good investment? Oh, there is no such thing as good investment out there. While there may be some low-risk investment opportunities, none qualifies to be considered as a good investment.
The first principle to become a good investor is to know that there is no such thing as a good investment. The general perception of a good investment is the one you took time and effort to investigate. It is the one that you put your thoughts and energy into.
What is a good investment for an investor A may not be a good investment for an investor B. There are complex algorithms and analysis involved in trying to know what good investments are.
However, the basic definition of a good investment is one that meets your expectations. This involves making investment plans and defining the purpose of your investment.
How to Start Your Investment?
Start your investment, no matter how small. You don’t need huge capital or so much to start your investment. Jeff Rose contributor on Forbes wrote, “Nobody is telling you to pour every extra cent you have into stocks.”
You can start your investment by setting aside some money, out of your daily expenses. Say $10.00. The size is not what counts but the discipline you need to allow your investment to mature.
One of the keys to financial freedom this year is to cultivate brilliant savings habits. And the popular one is the cookie jar approach. You can find some interesting facts from David Weliver’s 7 ways to start investing with little money.
Where to Start Your Investment?
For Muslims who are worried about the halal status of other investments, you can start with Wahed Invest (Get $10 bonus if you use my referral code: abdabd55 ). You can also read here if you want to know more about Halal Investment Apps. Or you can open your Acorns investment account here!
Apart from that, you can always come to the investment company to register and start learning with them. You also read The Best Strategy for Investment here.
When should you start investing?
As early as possible! Even children can invest. It is advisable to invest on behalf of your child if you have the means. It is also wise to teach and encourage your child to invest.
The need for investment as part of childhood development is a laudable prospect that will instill prudence into the child. Depending on your status and age, there are investment opportunities designs specifically for each of us.
Though there are technical differences between savings and investment, to the public, the simplest definition of investment is “savings.”
Savings are the initial steps to start your investment. If you do not have any savings and want to be an investor, you can start your investment career by saving now. There is no better time than now to start your investment journey. There are several online saving schemes you can explore.