Stock markets and investments can be challenging. We ease your way into the promising world of finance by clearing some of the misconceptions about the market
When it comes to investing, we are constantly inundated with information and opinions that shape the way we feel about our money — and, importantly, how we use it. Investments are crucial to growing your wealth. While there is a lot of investment advice available, not all of it may be true. Most investors don’t have any special qualifications as they’re just regular people who didn’t let common misconceptions keep them from getting started. Here are some common investing myths that you need to be aware of before you invest.
To get started, you’ll need a substantial amount of money: To begin your investment journey, you do not need a large sum of money. People often have this misconception that they need a large sum of money to open an account. Well, the good news is that you can begin investing in a mutual fund systematic investment plan with as little as Rs 500 per month (SIP). You do not wait for a hike or to accumulate a certain amount of funds to begin investing. The plan is to begin investing right away.
Waiting for the market to fall before making an investment:
It is commonly held that investors should buy stocks when they are trading at a lower price. Although this is an excellent idea, no one can predict how the financial market will fare in the near future. So, if the stock you want to buy is available at a reasonable price, you may purchase it. If you stand in line too long, even at the current price, you might not be able to get it. Unlike other investments such as gold and realty, the value of your furniture will depreciate with each passing year. Remember, the day you choose to sell your furniture, you will end up getting nothing more than an insignificant part of the cash you actually spent on buying it
To analyse stocks and make trades like a pro, needs time:
Investing isn’t meant to be as eye catching or thrilling as betting. The reality is that investing in the right stocks can be a little tedious. Once you’ve learned the ropes of investment and the markets, there isn’t much to do on a day-to-day basis. You’ll have to get a little proactive by taking on the onus of checking the market trends periodically and making necessary adjustments to keep your investment plan on course. Rather than wondering when to purchase and sell, consider whether you’re investing adequately for your financial goals and saving enough on a regular basis.
DID YOU KNOW?
To begin your investment journey, you do not need a large sum of money. People often have this misconception that they need a large sum of money to open an account. Well, the good news is that you can begin investing in a mutual fund systematic investment plan with as little as Rs 500 per month (SIP). You do not wait for a hike or to accumulate a certain amount of funds to begin investing. The plan is to begin investing right away.
You do not require emergency liquidity:
It is often believed that if you have a stable monthly income or earnings and a decent savings portfolio varying from Fixed Deposits to Mutual Funds, you are safe, particularly if you have also insurance coverage. No matter how many circumstances you’re reimbursed for, it’s essential that you have a fluid position for cash flow all throughout the period. As well as instant access to solvent assets such as gold, to keep you afloat during any drastic or unwanted occurrences in your field of work or the economy as a whole
Past performance predicts future returns:
Numerous factors can affect whether an investment’s value rises or falls. Never consider past performance as a benchmark to predict the future of your returns. Whereas the previous returns of a stock or mutual fund must be explored, they do not constitute a reason to drive growth. Knowing about investment myths will help you become a better investor who invests based on relevant factors rather than faulty information.
INPUTS BY: Manoj Dalmia, Founder and Director, Proficient Equities Private Limited
