Monday, November 26, 2007

Be sure of your Investment Horizon

When we invest without an adviser, we normally do our own Risk profiling
During this profiling, we identify our
a) Ability to Invest
b) Willingness to take Risk
c) Time Horizon in the investment

Many may have the ability to invest and willing to take excessive risk, but they forget their Time Horizon. What they look out for is quick profit and overtook by greed. I had seen many Aunties and Uncles punking their luck in the stock market. They forgot that they may need the money in the shorter term.

My advice is
1) Make sure your investment is for long term. Look out for
a) Good valued stocks or
b) 75%-Large Diversified; 25%-Regional/Theme Specific UTs.
Long term means money that you can live without for more than 10 years.
2) Go Super Short term for Contras and Day Trades in the Stock Market
3) Look out for "Put" Warrants or CFD to hedge your risk
4) If you have no time for such short term tradings, unfamiliar with Risk Hedging and don't have money for long term investments, you can consider putting into Cash Accounts or Money Market in this Turbulent times.

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