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- So you want to invest and make some money? Let’s talk about investment strategies.
- A lot of people make investments in order to achieve their financial objectives and meet demands that arise at various phases of life. It could be as little as investing in an expensive electric device or as large as buying their own home.
- These goals require financial resources, but not everyone has enough cash on hand to meet all of their demands at once.
- Investment strategies that can help generate money over time are needed for this. Certain goals can be achieved with fixed returns, but others require higher returns to cover growing expenses and set aside funds for more challenging goals like sending their children to college abroad or getting married.
What’s an Investment Strategy?
- Your way of choosing the investments in your portfolio is shaped by your investment strategy. The best strategies need to support your goals for financial objectives and wealth accumulation, all the while preserving a degree of risk that allows you to rest easy.
- Your approach to buying and selling assets will depend on a number of factors, including the kind of assets you have.
- When it comes to investing, it’s a good idea to ask yourself these fundamental questions: What are your objectives? When will you be able to retire? To what extent are you at ease with risk? What is your desired investment amount in stocks, bonds, or other securities?
- Here’s where investment strategies are useful.
8 popular Investment Strategies
There are many different approaches to investing; and here are some of the more popular investing strategies to consider.
Diversification
- This is the key. Investing in a diverse range of asset classes can help you minimise risks and optimise returns. Many opportunities exist in investment options such as stocks, bonds, mutual funds, real estate, and commodities.
- Putting all your eggs in one basket leaves you vulnerable to market swings. You can protect yourself against volatility in the market by balancing assets with higher risk and higher return with options that are more stable.
- As more investors look for ways to diversify their portfolios beyond traditional investments like stocks and bonds, investing in alternative assets has become more and more popular. A wide variety of assets that are not included in traditional asset classes are included in alternative investments.
Market Scenario
Global market trends, geopolitical events, and economic policies are just a few of the factors that could affect your investment. It’s important to keep up with these dynamics and how they might affect various sectors. Additionally, making wise investment decisions can be helped by being aware of the details of regulatory changes.
Long-Term Perspective
- Long-term investment periods tend to result in higher returns. Also, Investing for the long term can be a great way to manage your risk because you have more time to ride out market fluctuations and recover from any losses.
- Over time, investors who remain committed to high-quality assets usually benefit from the rewards of economic growth and tend to be less volatile than short-term investments, which can help reduce your risk.
- Consider things like your time horizon, risk tolerance, and financial objectives when making long-term investments.
- Your time horizon and risk tolerance may influence your investment strategy, and your financial objectives may influence the kinds of investments you choose.
Due Diligence
It’s advisable to do thorough research before making an investment. Making an informed choice can be helped by analysing growth potential. Sound investment decisions can be made easier by obtaining market analysis from financial experts and experienced investment platforms like Assetmonk.
Fractional Ownership
Fractional ownership allows investors to invest in desirable properties, like luxury vacation homes or prime commercial Grade-A spaces, at a fraction of the cost of full ownership.
The Indian fractional ownership market is expected to grow from Rs 1,500 crore in 2019 to Rs 4,000 crore in 2023.
Source: TruBoard Partners
Assetmonk, an alternative investment platform, offers a fractional ownership model where investments are secured and starts as low as 25 lakhs. It facilitates real estate investment by providing a user-friendly platform, transparent pricing, and hassle-free property management.
Increased Accessibility:
- Lower investment requirement: Compared to buying whole properties, fractional ownership allows you to own a part of valuable assets with smaller capital, making it accessible to a wider range of investors.
Diversification Benefits:
- Spread risk across different properties and locations: By investing in multiple fractional properties, you reduce your dependence on any single asset, mitigating potential risks and creating a more balanced portfolio.
- Gain exposure to diverse asset classes: You can diversify beyond traditional stocks and bonds and enter the real estate market, adding a different asset class with potentially higher returns and lower correlation to other investments.
Enhanced Liquidity and Flexibility:
- Easier entry and exit: Fractional ownership platforms often offer greater liquidity compared to traditional real estate, making it easier to sell your share when needed.
- Reduced management responsibilities: Unlike owning a whole property, fractional ownership typically involves limited management responsibilities, making it a more passive investment option.
Additional Advantages:
- Potential for higher returns: Fractional ownership often provides access to prime properties with higher rental yields and capital appreciation potential compared to smaller, individual investments.
- Passive income generation: You can passively receive rental income from your fractional share, providing a steady stream of income.
Fractional ownership options by Assetmonk offer a great opportunity for long term retail investors to get a CRE exposure with a high long term earning potential of 14 to 21% p.a.
Use Technology
- Technology gives people access to a wide range of platforms and investment tools. Fintech solutions, investment applications, and online trading platforms provide investors with convenience and real-time data, enabling them to make well-informed decisions quickly.
- Adopting technology can improve decision-making and speed up investment processes.
- Banking on the strength of technology, Assetmonk has been a top player in the proptech industry. In order to meet the individual needs of investors, Assetmonk aims to offer wise real estate investment options.
Keep Reviewing
It is wise to examine your investment portfolio on a regular basis. Market conditions change over time, and regular evaluation enables adjustments in line with evolving objectives or trends. Optimising returns requires flexibility and being willing to reallocate assets in response to performance and changes in the market.
Risk Management
It’s important to manage the risks involved with investments. Assess your risk tolerance and diversify your investments across different industries by using risk management techniques, such as hedging or stop-loss orders for equity investments, which can protect portfolios in volatile market conditions.
Bottom Line
Investors can take advantage of the opportunities in the economy and position themselves for long-term growth by utilising these strategies.
Keep in mind that there isn’t a single formula for maximising returns. It’s a personalised journey that calls for thorough preparation, continuous learning, and an ability to adjust to shifting market conditions.
You can easily attain long-term wealth and financial independence by implementing these eight essential strategies into your investing strategy.
Dedicated to offering exceptional investment opportunities backed up by real estate assets, Assetmonk is a fast growing and promising alternative investment platform in India. Investors get access to a wide range of carefully selected, high-yield projects that come from India’s thriving private markets. Investors can participate in our structured debt offerings in the commercial real estate sector with an assured IRR of 17% with investment as low as 10 lakhs. Start Investing today!
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FAQ’s
Q1. What investment goals should I set for myself before choosing these strategies?
A. Your goals will impact which strategies are most relevant. Consider retirement planning, income generation, wealth creation, or short-term profits.
Q2. How can I assess my risk tolerance and choose strategies that match it?
A. Consider your financial situation, age, and emotional comfort with potential losses. The blog will likely offer strategies for different risk levels.
Q3. What’s the Best Investment Strategy?
A. Fractional ownership emerges as one of the best investment strategies providing investors high returns and creating a more balanced portfolio with potentially lower volatility.
