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Monday, March 15, 2010

The safest investment and how to maintain them

A safe investment can be defined as an investment that renders easy generates in a quiet gamble. Nearly everyone invests money to guarantee themselves financially done with investments such as stocks, real estate and bonds.

Before you commit your money, you must realize thoroughly the intricacies of getting an investment. Here are the 3 key factors that determine the difference between a guarantee and an un-insure investment:

jeopardy: The amount of jeopardy you take while gaining an investment is dubbed as your gamble appetite. It is said that higher the gamble, greater are your chances of getting a higher return.

Time span: This refers to the duration of time for which you make an investment. The safety of your investment is dependent upon several variables such as fluctuation of the market place, liabilities and more. You must keep in mind your personal needs for getting the investment. You can have a short, medium or long-term investment depending on the above-mentioned factors.

Most investors use below given formula to calculate how to make a stable investment:

For instance, if the age of the investor is 40, he should commit 60% (100-40) of his total investment amount in equities and the rest 40% in government securities.
All investment options carry certain inherent risk factors. Thus, a study of all investment options is crucial to safely commit your hard earned money.
Fixes: Deposits are a solid investment option, but they offer very small returns. Deposits include government bonds and fixed deposits.
Growth in a mutual way: In a mutual fund, professional people manage your money. The risk is little as your investment is wide-ranging.
Buying and earing off of bonds: Buying a bond is similar to lending cash to an organization. You earn interest on that amount.
Long term options: An equity is a long-term sound investment option that offers considerably higher takings than other secure investment options.
Solid backing of the paper currency GOLD: When the stock markets go down, the price of gold goes up.
Real Estate: The real estate marketplace is a profitable, but unpredictable investment option.
You can also consult an analyst or a wealth manager to help you make a sound investment. Thus, weighing all the pros and cons of investing in specific sector.

Having a varied portfolio : A broadened portfolio is at smaller chance than an un-broadened one, because your investments are separated out. So, still if 1 market place is not managing well, your other investment may still make you money. A diversified investment portfolio works by acting as a shock absorber when the market falls. You must not keep all your eggs in 1 basket if you want to invest safely your money.


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