The stock market offers much more interesting returns but because of the element of risk many people avoid it. Worse still they might enter the market at the top and then sell out later at the bottom. Here are some tips to help you navigate the market and build a large stock portfolio over a long period.
- Spread your risks by investing in a number of stocks in different markets and in mutual funds, bonds and other instruments. A good rule is that no one stock or other investment should be more than 10% of your total portfolio.
- Take advice from various sources. Invest in some companies whose products and strategies you like. There are a multitude of comparison sites and other resources on the internet to help you to analyse and understand investments.
- Not all stocks, however, are suitable long term buys. products that can endure and aren’t fads; a history of leaders who can adapt; a strong balance sheet; a track record of innovation balanced by vigilance against taking on too much risk; and a strategy that looks beyond the next year and certainly beyond the next quarter.Check out the list of long term investment stocks.