Someone also said that “Investing is like shopping at a garage sale. You simply look for something you understand that’s selling at a great price.
Yes, this is true that through investing one can grow his wealth. He doesn’t have to have a lot of money to get started. The stock market, Mutual Funds, Investments Bonds, Saving Account, and Physical Commodities, you have plenty of options to invest your hard-earned money. Simple fundamental is that you can select a strategy that works best for you.
In a simple sense, investing styles and tactics are like the clothes that suit and fits you the best. To look best, you not always required to buy something very expensive, and custom made. While when the matter of clothing comes you always look for something in which you feel comfortable, suits your personality, and gives you a trendy appearance. The same example applies to your investment objectives.
So before making a commitment to anything, whether it would be food diets, purchasing something from a garage sale, choosing clothes, or looking for an investment strategy, always see which works best for your personality and style.
You can start by considering the top five investing strategies to decide better where you want to invest?
5 Best Investment Strategies To Grow Your Wealth
1. Fundamental Analysis
It is one of the oldest and most basic forms of investing styles. Primarily it was used for researching and analyzing equities like individual stocks, in spite of mutual fund selection. It involves analyzing financial statements for the purpose of selecting quality stocks.
Under fundamental analysis, data from the financial statements is used to compare with past and present data of a specific business or with other businesses within the industry. After analyzing data, the investor arrives on a decision if the stock is a good purchase or not.
2. Technical Analysis
In it, investors using technical analysis to recognize recent price patterns and current market trends with the use of charts. Technical analysis is used for the purpose of predicting future patterns, future market movements, and, trends.
This analysis is often used by technical traders to get signal (usually called indicators), to know about future market trends.
3. Value Investing
Value investing simply means to buy stocks that are cheaper than they should be. Mutual fund and ETF investors can opt for fundamental investment strategy by using value stock market funds.
In other terms, value investing is something like looking for stocks selling at a “discount;” to find a bargain. What mutual fund investors do? They actually buy index funds, ETFs (Exchange Traded Funds), or actively-managed funds that hold value stocks, rather spending time on searching for value stocks and analyzing the company’s financial statements.
4. Growth Investing
As the name indicates, growth investing refers to growth stocks. These stocks usually perform better in the mature stages of a market cycle and also when the economy is growing at a healthy rate. The growth investing strategy reflects what consumers, corporations, and investors have high expectations of future growth, and spending more money to do it for a healthier economy. Technology companies are good examples of growth investing. These companies are typically valued high and can continue to grow beyond those valuations when provided with the right environment.
5. Buy and Hold
Buy and hold investors believe in “timing the market”. In this kind of strategy, investors buy investment securities and hold them for long periods of time. This investment strategy works on the belief that long term results are reasonable rather than the volatility characteristics of short-term periods.
As per the buy-and-hold investors, holding for longer periods requires less frequent trading and thus trading costs are minimized, and overall net return of the investment portfolio will be maximized.
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To reach the final conclusion, read the initial paragraphs of the blog again.
Always remember that choosing an investment strategy or style is no different than choosing investments. Each investor is unique, have unique investment objectives, and tolerance for risk and thus he also requires best and unique investment strategy or strategies.