Five steps to establish your status as an investor
Knowing the basics about investment is vital for any business owner who is investing some small business profits into the financial markets. As the owner of a small business you need to understand the foundations of investing before you begin to risk any money.
But what happens when you have been investing for a while? This can actually be a point where many investors hit a big stumbling block. They may make some headway as a new investor initially but then feel frustrated at not progressing further. If you are at that point, then knowing how to maintain a firm foothold as an investor while also making further progress is vital.
Whether it is the London Stock Exchange you invest in with its market cap of almost $5 billion or the classic car market which saw a rare Ferrari sell for 70 million Euro’s recently, knowing how to stay ahead in the game is key.
Top tips on cementing your status as an investor
In some ways you have already done the difficult part of getting involved with investing as a small business owner, however, establishing yourself for the long haul requires some further work but it can be done. There are some useful tips below to help you along this next stage of the journey.
Keep learning – any basic guide to investing will highlight how important it is to have a knowledge of the financial markets. To really establish yourself as an investor on the markets, research and acquiring knowledge is something that you should do constantly. Keep striving to learn more advanced tips and techniques to help finetune your investment strategy. Whether it is high-level qualifications similar to those which investment guru Fahad Al Rajaan holds, or information from books or online articles, it is vital to keep learning as much about the financial investment world as you can.
Network with other investors – a great way to really cement your status in the investment world is to be a visible presence. Take the time to network with other small business owners who also invest profits and those who work in the investment sector. Whether it is physical events or online via channels like LinkedIn, networking can give you new ideas and contacts to continue your investment journey.
Hold a diverse portfolio – establishing your status as an investor means staying in the game. This is no different to your own small business which needs to be open and selling to the public to make any money. Unfortunately, too many investors risk this and their future investment journey by failing to hold a diverse portfolio. The problem with having all your money tied up in one sector or company is that if it drops a lot overnight then you could lose it all! It is much better to hold assets in a variety of sectors and companies to protect your investment future.
Think about long-term investing – many successful investors advise holding assets for the long term. Usually if people with this amount of investment experience under their belt make such comments it is worth listening. The reason that long-term investments are advised is simple. They allow you to ride out any short-term market fluctuations to make money overall. This will help you to keep investing for longer and not be wiped out by an overnight market move.
Stick to your plan – as a more experienced investor who has got the basic knowledge, you should have a written investment strategy to follow. One great tip to stay active in the investment world is to keep following it daily. Some investors are successful and then become bored which can lead to them taking their eye off the ball – big mistake! It is vital to stick to your plan and to review your portfolio at regular intervals – if you see that it is time to get out of an investment that is not working well, do not be afraid to sell to reduce your losses.
Investing for small business owners makes sense
As a small business owner who is already investing some spare profits, you know it makes business sense. Not only can it make additional money for your company in the long term, it can provide an extra revenue stream through dividend payments. If you are looking for ways to continue your investment journey and become more established in the investment world, following the above tips is a good starting point.