The Basics Of Investing

When it comes to investing your money, do you know where to start? If not, check out this reference guide that may be able to help you go in the right direction. But note, not all investment strategies are guarantees of proven performance because investments on the stock market is a fluctuating risk you must be willing to take.

Investing 101

Defining the term of investing generally means the act of putting money or capital into an endeavor with the expectations of getting additional profit from that endeavor.

For instance, you purchase stock of a company with the anticipation of that stock rising in price. If you were to sell that stock, you would sell it at a high rate than you bought it for thus making a profit. However, if that stock price drops, you essentially lose money on that stock because you purchased it for more than what it is currently worth. This is just an elementary example.

What Is It?

When looking to choose an investment, the choice is really up to the investor and what their goals are. There isn't right or wrong choices, so to say, because investments can be very different. But before you choose a specific investment, an advisor could help go over your financial goals. Some investors choose advisors from Mark Matson's firm Matson Money to look over goals. But the ultimate choice is up to the investor.

How To Pick Investments

People who choose to invest have many different reasons. Some reasons include retirement planning, the idea of making money for a big purchase or simply to increase wealth. However, not all investors are able to meet their goals because the market can go up and down at any time.

Why Invest?

Often times you'll hear investors talk about portfolios and this essentially is a list of different investments that are mixed and matched. The purpose of a portfolio is based on the investors' goal and sometimes a portfolio may be diversified. A diversified portfolio is filled with different investments that may counteract ups and downs in the market for certain investments.

What Is A Portfolio?

Like mentioned before, a diversified portfolio is centered around different securities that have different performances. With a mix of assets, a diversified portfolio may not suffer from a decline because of one security because a different security in the portfolio may be performing well. However, not all investment strategies are the same nor do they guarantee proven performance.

Diversified Portfolio