While investing for the future is something that concerns every individual nowadays, not everyone has the complete skill set to make the most of their hard earned money. Richard Cayne of Bangkok’s leading investment firm says that investing is an art, wherein one allocates money in such a resourceful manner that it generates profitable returns in the future. However, amateur as well as veteran investors are all prone to making a few mistakes while making investments.
According to Richard Cayne of Bangkok’s leading investment firm, one of the most commonplace mistakes made by enthusiastic investors is not setting clear goals. You should not only be clear on the amount of money you need to save given the present scenario, but also have a realistic view of the kind of wealth base you would like to create for the future. Richard Cayne of Bangkok explains that making investments without setting appropriate financial goals is like shooting in the dark, which significantly lowers your chances of success.
The second most common investment mistake according to Richard Cayne of Bangkok is not following a set financial plan. Over the years, many surveys have pointed to the fact that individuals who write down their investment plans are far more successful in achieving their financial goals than those who do not. Your financial plan should not only answer questions like where to invest and how much to invest, but also when to invest and what to expect.
Another common mistake made by even veteran investors, as mentioned by Richard Cayne of Bangkok, is parking all of your money in similar kinds of investment vehicles. A smart investor should always strive to diversify his/her portfolio by choosing a combination of investment vehicles which do not directly correlate to the equity markets. For instance, while stocks and shares directly correlate, hedge funds should not correlate with equities or else the diversification is not there. Such diversification helps maintain the performance levels of your portfolio even when the equity markets may not be doing well in general.
Last, but not the least, Richard Cayne of Bangkok’s leading investment firm says that avoiding a consultation with an experienced financial advisor is one of the most common mistake made by most individuals. While it is true that you are the best judge of your own finances; however, the added expertise of a professional will not only help you sort out short term financial concerns, but also help keep your long term goals in perspective. Professional financial consultants hold years of expertise in observing market trends, mitigating risks and aligning personal goals with the same, thereby helping your portfolio perform much better than it would on its own.