Investing without an investment strategy does not work. The question is: how to invest in less risky stocks while getting a good return. Visit us via this ip to know more about winning strategy. Here is a proven investment strategy, a tool that works but only if it is used properly.
You can use a tool called DOLLAR COST AVERAGING to reduce your risk and improve overall performance if you invest in stocks over time (as in a 401k plan). You can also use this investment strategy when you have a separate amount of money that you want to invest in stocks.
Here is an example of how to invest in stocks using this tool in a general diversified equity fund as an equity investment. Why we use it as our auto investors tell us later. The image you have $ 50,000 that you want to invest in stocks, probably sitting on your 401k plan. The stock market is bored and you want to reduce the risk of investing at the wrong time.
Solution: Use the average monetary value by systematically investing the same amount of money at predetermined intervals. In this case, our investment strategy is to invest $ 50,000 by investing $ 10,000 every three months, for five quarters, in a diversified equity fund. Watch what happens when we invest the same amount of money in each period of time as the price of the fund changes over time.
- 1st stock market investment: $ 10,000 to $ 20 will buy 500 shares.
- Second investment: $ 10,000 to $ 15 will buy 667 shares.
- 3rd investment: $ 10,000 to $ 10 will buy 1,000 shares.
- Fourth investment: $ 10,000 to $ 15 will buy 667 shares.
- 5th investment: $ 10,000 to $ 20 will buy 500 shares.
- Totals: $ 50,000 invested … 3334 shares purchased and owned.
- Total equity investment funds: 3334 shares x $ 20 = $ 66,680.
- Profit: $ 16,680.
The price of the stock fell and then recovered to end up at the same price as the one with which it started. The same amount of money is invested each time, including purchases of the price from $ 20 to $ 10. Get more winning strategy from us today via our site ip today. If you invested $ 50,000 in advance in a lump sum of $ 20, you would have had a tough trip and happy breaks just a year later. Instead, make a profit of $ 16,680!
When you invest in stocks per dollar on average, beware. Do not use this investment tool in an individual stock, especially in a theory. It’s hard to manage the money. Why?
If you continue to invest in stocks and buy more stocks in a fallen stock market, you make a guess: that stock prices (in general) are too late to recover in the not too distant future. This is a reasonable assumption, as it always happens throughout the history of the US market.
On the other hand, each year, the number of individual stocks is rejected and can not be recovered. Even big companies can go bankrupt … for example, General Motors. Make dollar costs part of your overall investment plan. It requires you to buy more and more shares while stock prices will be cheaper and cheaper. This translates into a lower average cost per share. Make sure that your equity investment is a choice in the US stock market in general, as opposed to an individual stock that can drop the face of the land that has left you. Studying how to invest in stocks with an investment strategy that attracts the level of risk is key to being comfortable with your investment stock.