Stages of Making Investment

I know Investing is the complex process for those who are not from “Finance Background” but this article will help you to make you smarter investment move.  Through the following diagram will understand how you will become a smart investor.

1. Your Capacity :- The main and most important point which people will forget while doing investment is “Capacity” . People chase to make investment by cutting of their regular day to day needs. This should not be done. You simply have to follow 50:30:20.

Following diagram will help you to understand 50:30:20 rule.

2. Setting Goals :- Firstly you have to  decide your goal for making an Investment. Define specific, measurable, and achievable financial goals, such as retirement planning, wealth accumulation, or capital preservation. In short your Goal should be “S-M-A-R-T”

3. Research :- Investor should gather information about potential investment opportunities, analyzing market trends, back testing of Index and investor also have to research about

Global news because Indian Market is depend upon “n” number circumstances. Investors should carefully examine factors such as financial statements, industry trends, competitive landscapes, and economic conditions to identify the most promising investment options.

4. Interval Monitoring :- The most important point is monitoring your investment. Investor should keep watch on investment at a certain interval like weekly, monthly, yearly. This will help you to track your progress or you’ll get to know about the changes in your portfolio. This also known as portfolio management.

5. Results :- At the end results matter, check your returns on the investment whether it is increasing or not. According to that adjust your portfolio items for future progress. This process will simply help you to know the return you should earn in respect of your risk appetite.

So these are the key points that will help you to become smart investor. As a suggestion firstly, you have to decide in which asset class you need to invest. Like set your goals year by year. For example, for the 1st year you only made Gold investment, in the next you are willing to create good stock portfolio & at last you want to invest in real estate in short “Asset Classification” should be proper as per your desires and need.