Although the stock market is an uncertain place There are tried-and-tested strategies that can increase your chances of long-term success.
Investors must first establish their financial goals. For example, saving for retirement, purchasing a home, or funding the education of your children. This will help them determine how much money to put in and which type of investments will be best suited to their situation.
It’s also recommended to prioritize building an emergency fund and paying off debts with high interest prior to investing heavily in the market. Start with a small amount and then increase your investment over time as you get more experience.
Keady says that one of the biggest mistakes made by beginners is trying to predict the market. “Nobody knows the perfect time to invest,” she adds, noting that the best strategy is to commit to an investment that will last for a long time and stay with it through the rough patches.
If you’re only beginning, it’s a good idea to concentrate on stocks from companies that you understand. As the legendary Fidelity Magellan fund manager Peter Lynch famously observed that you have a greater chances of winning by betting on companies with a solid track record and solid growth prospects, rather than trying to predict the future.
It’s recommended to stay clear of online forums and ads touting sure-thing stocks. In many cases, these are part of a pump-and-dump scam where shady investors purchase shares of a sluggishly traded company to boost the price and then dump their shares to fund their own pockets.
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