Many of us think that earning money in the stock market is an easy task. Many amateur investors come into this business, keeping in mind that they will earn a huge amount of money by doing nothing but investing in a company or industry. But eventually most of them understand it very well that the stock market is not their cup of tea. There are more than hundreds of factors and terms other than buying, holding and selling of stocks. The investor has to do a lot of research and before he can actually buy a stock or invest in something. Luck surely works sometimes, but not always, you cannot rely on your luck totally if you are into this business. If you do not have much knowledge doesn’t mean that you cannot succeed in business, you can follow some of the biggest names in the field of investing. Most of them have an experience of more than a decade, they can surely instruct you by their advices which will help in your business.
One of the biggest names in the stock market from many decades is Jim Rogers. Jim is currently the director of the JC Wealth management group and LLC for both Lancaster and Hilliard branches. He is also an investment advisor representative of Voya Financial advisors and has got an experience of more than 11 years in this field. He used to give advices to new and amateur investors in the field of investing so that they can build up their name as well. Some of top advices given by Jim Rogers are-
Hold your own year-end review
The thing which you can do most easily is checking your own portfolio and the financial performance at the end of the year. When you see what you and your company has done in this year, you can plan for the upcoming year the mistakes and profits you made last year can be a lesson for you this year and this will surely help you out. You can also adjust your current portfolio so that you can keep track on your investments.
Resolve to learn something
Sometimes when you are doing your work, you could hear some new terms and many questions start coming in your mind like, “I have no idea how bonds work” or “What the heck is an ETF?” Well this is the time, you must not panic of feel disappointed. This is the time when you have to educate yourself and get yourself familiar with these terminologies. Experiences helps you a lot in the field of the stock market, but sometimes we don’t have time to get experience, you have to learn at that time about the stuff related to your business.
Know your tolerance for risky business
The stock market is a place where the market is never stable, in the morning it can be very good and by evening it can be as bad as your worst nightmares. Let us take a situation, one day the market drops and immediately you look at your balance and it is low. This is the time you have to be brave and take some important risks off the table. There is a rule for this condition: whatever your age is, take that particular number and use that as the percentage of your total holding for safer, fixed-income investments such as bonds.
No risk, no return
There might be some stages in your business life when you start feeling that investing in stocks is a very risky task. But according to the investment advisors, avoiding the market risks is eventually a losing strategy. It may be possible that the recession has taken all of your returns but you have to get back to the market after this because staying out of the stock market will increase your inflation risk. If you keep money in your bank account, it is not increasing. It will be the same plus it will lose its value over time.
Reading about stuff related to your business will surely help you out. It can provide you a good foundation, it will give you knowledge about the work and you can surely make a difference with that. There are many situations when you need knowledge about a thing or two. What if you already knew all that stuff? This can give a push on your success. You can read books, novels, articles related to your liking and this will help you out.
Know that interest rates will probably rise
There is a huge probability that the interest rates which are at the bottom of the list will rise after some time. If they rise, there are two challenges which can be faced by you, the investors that is bond duration and adjustable rate loans. In that condition, you must switch to the shorter duration bonds because they are less sensitive to the rising and falling interest rates in comparison with the longer duration bonds. And holding a mortgage or other adjustable rate loan might experience a rise in cost.
What are you losing to fees
The investment fees of workplace retirement plan should be plainly stated, but this is not the same always like in most of the IRAs you have to look much harder. In order to reduce the total expenses, shifting to the ETFs is a good choice because the fees there are lower, it can changes made by you can decrease the fees by a big number.
Master your emotions
The main cause of failure in the stock market is the wrong decisions taken by the investor. Most of the wrong decisions are taken by the investors when they are going through an emotional distress. In the conditions of mental trauma, instead of becoming depressed work on your portfolio and see how you managed to cross the worst conditions of your career.
These are some advices given by Jim Rogers. Following them will surely going to help you in your current as well as future investments.