The stock market. It’s a word that sends fear into the hearts of many. While the stock market can seem like second nature for some, for many of us it may seem like a foreign language. As such, we steer well clear and prefer to keep our money where we understand what it’s doing.

There’s nothing wrong with this, and there’s certainly a lot to be said for avoiding complex financial investments if you don’t understand it. Still, as you’re probably already aware, the bank (or under your mattress) isn’t the best place to make the most of your funds. Inflation, which is the slow and steady rise in prices each year of goods and services, is about 2%, so putting money under a mattress where it’s ‘safe’ means you’ll only have $0.98 next year of each dollar you put in now. Even if you are staying away from complex investing like forex trading and its counterparts, there still are investments that young professionals should be considering.

If you stop to think about it, all of us have used our investing skills and made investments whether we’ve realized it or not. Buying a house is perhaps the most obvious one, but you’ve also picked an investment when you bought a car or a large appliance. Investing your money into stocks and bonds use the same ideas and principles, so you just simply apply the same processes you made in picking a house to the stock market. Let’s look at the skills that’ll make you a successful trader not matter what the investment!

Always consider future worth

You might not be much of a trader, but we’re betting even you know that investing is really just looking into and trying to figure out the future value of an asset. With any investment you want it to increase in value, not decrease, so you take some time and do some rough estimations on what’ll happen in the future. When buying a house, for instance, it’s always worth considering future shopping centers, transport links, and other such lucrative additions. Equally, investing in vehicles that age well can ensure you at least get what you paid when it comes time for exchange. 

Protect your assets

The first rule of investing your hard earned money is – don’t lose money. Of course everyone will break this rule from time to time, there’s no guarantee that any investment will always increase in value. However, with simple things like house insurance or extended car warranties like those found on this link, can all be useful here. Equally, keeping on top with maintenance and improvements at all times is sure to help. That way, you can guarantee this investment doesn’t crash and burn before you’ve had a chance to make any real money. Same goes with investing in the stock market – be smart and adjust your portfolio over time, and ensure that you’ve got an appropriate mix of risk. If one stock has been a real winner – don’t be afraid of taking money off the table!

Build your portfolio

Even those of us on the outside understand the value of a trading portfolio. The general rule of thumb with it is to diversify your investments (not all eggs in one basket), keep an eye on them to make sure you’re not caught off guard by big changes, and generally maintain your investments. Ultimately, you want to invest in different personal areas, such as travel, lifestyle, etc. By keeping track of each of these and treating them like an investment (i.e. carefully considering their present and future value), you’ll be in the best position to back down payments, secure future loans, etc., and generally reap investment rewards that wouldn’t be possible otherwise. 

Whether you’re investing in the stock market or looking to buy a new house, adopting an investing strategy can help you make better decisions now and protect your purchases in the long run!

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