The Good, the Bad and the Risky: Investment for Beginners

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Investing is a smart move if you want your money to work harder for you. However, every investment comes with certain risks attached that could mean that rather than working hard, your money swirls down the drain instead. This is why lots of people avoid investing and just save instead.

Good money management is about balancing your sheets each month and opening yourself up to good investment opportunities when they come around.

While having savings is certainly a good idea, leaving a lot of money in a low interest account when you could take an investment at a higher rate is bad economic judgement. Yes, risk is scary, but if you balance your portfolio and do your research, you should never find yourself in a real disaster.

A Good, Low Risk Investment

To cut your teeth on investments, you should first ask your financial advisor for some help. They will be able to point you in the direction of some relatively low risk investments. It is important to remember that no investment can be completely risk free, however, the lower the risk, the better a chance you have of it coming through.

Stocks and shares are always considered to be high risk, but with the right knowledge and a practised eye, you may be able to identify some lower risk stocks and shares to invest in. Have a look at MSCI stock, for example, and see how the stocks here are ranked. You can also see the history of the shares and a stock score. Though what has happened isn’t always the best indicator, it can suggest a trend that a more practised eye will be able to interpret.

Bad Investments

A bad investment can be anything from misplaced trust in a particular investment, an unlucky shot or even a con. There are lots of con artists out there looking for people who want to invest but are looking for low risk, high return options. Often they will email you with what looks like a once in a lifetime opportunity that you simply can’t miss.

Unfortunately, lots of people get caught out by this scam. Don’t be one of them. Read the email carefully. Is it likely that this person would want to contact your personally? Are there any spelling mistakes or is the language odd? Does the logo look real? Is the address given real? If the answer to any of these questions is no, this is a bad investment. This is a con.

Feeling Brave? Take a Risk

If you have a wide portfolio of savings and low risk investments, it might be time for you to take another step and invest in some riskier options. The stakes are high here so start small and remember don’t assume that if you lose this time, it will all be fine next time.

Taking a risk is good idea if you have some extra money and you won’t feel the sting if you lose it. However, do make sure that you still do your research before you act. The investor is only as good as their research, and the more information you have, the less risky it becomes.

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