5 Long Term Investment Strategies

The current crisis, crippling world economies is actually a scenario that investors dream of. Baffled much? Let us explain. Investing in a crisis situation is high-risk high-reward. Look no further than the 2008 financial meltdown, when shares plummeted like anything. Bearing that in mind, long term investment options remain a far fetched idea. but, how true really is that?

However, during the same year, smart investors pocketed tremendous amounts of money simply by purchasing assets from those who were hapless. This is essentially buying off a luxury watch dirt cheap from someone who has a week to leave his place of residence. Also, don’t forget, businesses like Netflix, LEGO and Mailchimp began to thrive during the financial fallout.

So, let us talk about 5 long term investment strategies immune to the changes in the financial markets.

Invest in Stuff You Understand
As a rule of thumb, if you are starting out, you should always consider areas you are familiar with. Do not give into the fancy pitches of the investment agents because later they can easily leverage your lack of comprehension of that market against you.

For example, if you are not technology savvy, then avoid investing in things like tech start-ups, or innovative apps. Dont go with the flow, and try to Just play to your strengths.

Start Early. Be Patient
Whether its investment management, mutual funds or real estate, the key to success lies in patience and starting early. Take the example of Warren Buffet, who advises people to invest in their early 20s and wait patiently for the rewards a little later.

It is simple mathematics really – someone who invests $5k monthly in their mid-20s has better chances of getting returns over someone who invests the same amount in their late 30s.

Wait for the Bull to Strike
A bull marketplace has share prices on the rise or expectations on a rise. Such a marketplace discourages buying/selling of trade. As a keen investor, you should always keep an eye on the demographic, psychographic and the economic trends to predict a bull market.

Once the market is beginning its transition to the bull state, you make your move and buy early. Later, sell those stocks when the prices peak. However, such a strategy requires astute market knowledge beforehand and the capacity to take on some level of risk.

Money isn’t Where the Heart is.
As an investor you need to follow your brain – not your heart. Starting out, a lot of investors make the mistake of taking emotional decisions. You need to be extremely pragmatic when assessing an investment opportunity.

Separating your emotional involvement with a practical decision is key if you want to reap the benefits in the long run. It’s also important to acquire services of an investment manager who can guide you in taking decisions.

Manage Your Funds Wisely
One of the most important parts of being an investor is to manage your cash flow. The dedicated funds for investment should not interfere with your personal savings. So, the sine qua non here is putting your funds in different buckets. And the buckets should not leak and intermingle with one another.

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