The art of successful investing

The seven key things to consider that will help you invest with confidence

1.  Don’t put all your eggs in one basket

Cash needs to be kept separate from your longer term savings strategy, which should comprise a spread of assets – equities, bonds, commercial property and so on – to provide as much diversification as possible, and the best chance of achieving your financial goals.

2.  Work out your attitude to risk

This depends partly on your circumstances; generally the younger you are, the more risk you can afford to take.  As you near retirement, the risk profile in your portfolio should be scaled back to minimise the danger of large fluctuations in the markets seriously damaging your portfolio.

3.  Look long term

Remember when investing you should have at least a five-year time horizon and avoid the financial perils of trying to time the markets as the sharpest falls and the largest gains are often concentrated in short time periods.

4.  Regularly review

Times change so it’s important to review your portfolio regularly and adjust it if necessary.

5.  Be flexible

When interest rates start to rise, that too will have a bearing on your investments.

6. Stay tax efficient

Make use of your ISA annual allowance as returns on your investment are tax-efficient.

7.  Get advice

It pays to call upon the expertise of a professional adviser who will carefully consider your objectives and put in place an investment plan suited to your circumstances.

John Baxter1 Comment