By 
Successful investing doesn’t come overnight. You have to learn the ins and outs of the financial world, develop your investing personality. The following are steps you need to take when traversing the word of investing.
Get Ready
Keep in mind successful investing is a journey. It doesn’t happen one time. You need to get ready by defining your goals. After having your goals nailed down, you create your plan according to these goals.
Ask questions like how long you are in for the investing game. How much capital do you need?
Know What’s In
Hit the books and take investment courses dealing with the modern financial ideas.
Learn about theories like portfolio optimization, diversification, and market efficiency. Keep in mind investing is a mix of combination of science (financial fundamentals) and art (qualitative factors).
The science is where you can start and should not be skipped. If you’re not good with that, it’s okay. Hit the books and find trainings to hone this skill.
After learning these theories and what works in the market, come up with rules fitting your investment philosophies.
Hone Your Investment Strategy
You are the best person to assess your whole situation. So, you are the best person to do your own investing. You may need some help, too.
Determine the personality traits that can prevent or help you in investing successfully. Learn to manage these traits.
You can follow an investing personality model that classifies investors based on two characteristics: method of action and level of confidence.
Based on these two, you may belong in one of the following:
- Individualist – careful and confident investor. Does the DIY approach
- Adventurer – volatile, strong-willed, entrepreneurial
- Celebrity – follower of the latest fads
- Guardian – highly averse to risks and likes to preserve wealth
- Straight Arrow – has all of the characteristics of the first four
Keep in mind you’re also your worst enemy. Depending on your personality, strategy, and goals, you may be causing some of the problems you’re experiencing and don’t know it.
The Right Path
The right path is determined by the combination of your knowledge, personality, and resources. In general, investors follow one of these rules of thumbs:
- Diversify and never put all your eggs in one basket
- Put your eggs in one basket but watch that basket carefully
- Use a combination of these rules and make tactical bets on a core passive portfolio
Many successful investors kicked off their careers with low-risk, highly diversified portfolios, and they learn by doing.
As you get more knowledgeable over time, you become better suited to adopting a more active stance in their portfolios.
Eagerness to Learn
While the market is certainly hard to predict, you can be sure it’s going to be volatile. Becoming a successful investor is a slow and gradual process. It’s a long ride.
The market will sometimes prove you wrong. And you must acknowledge that and learn from the mistakes.
Also, staying in the game for a really long time may not sound so endearing, but it’s one of the ways you can actually increase your chances of success.
Familiarize yourself with industry knowledge and practices through training sessions designed and led by professional traders in Kapital Zentrum. They offer financial market information in different packages.
