It is easy for new investors to underestimate the difficulty in choosing profitable investments. Often they discount the education and insight that is needed to develop and maintain an investment portfolio that performs well in a majority of economic climates.
Looking back, if I could have given my younger investor-self some valuable advice about making my first investments, it would be this:
- Learn From The Experiences of Others.
- Seek-out Consistent Performers, Not Top Performers.
- Introduce International Markets Early.
The Experiences of Others.
Before building an investment portfolio, investment-seekers new to the market would be wise to seek the advice of much more knowledgeable investors who are eager to share their investing experience. Being able to trust the information you are being given is paramount to your success, particularly when taking your first investing steps.
The only source of knowledge is experience. – Albert Einstein
Believe me, someone who has participating in the volatile markets of the last decade can share a wealth of information with new investors, that will set a positive foundation for investing behavior; and avoid costly “rookie mistakes.”
While most investors will be on the look-out for top performers, focus your energy on opportunities that have been consistent performers. These are alternatives that have been profitable despite the economic turmoil all over the world.
Trust is built with consistency. – Lincoln Chafee
Although the rate of return may not be as high with consistent performers, the track record shows that they are likely to be a lower risk.
Carefully consider investing opportunities in international markets. This approach offers diversification that can profit from global trade and economic growth.
Diversification and globalization are the keys to the future. – Fujio Mitarai
Slowed economic growth in one area can be off-set by increasing growth in other regions. Investors who invest in shipping containers are an example of people profiting from this approach.
New investors should be cautious, but not scared, about making their first investment. I have learned that fear can be alleviated through asking questions and finding answers.
Don’t expect that the best information you receive will be from friends and family. Look to well-established publications (on and offline) to satisfy your thirst for answers. Be relentless in your research.