Little knowledge is always dangerous. In this informative world where information is overloaded, many still remain unknown because of lack of the right information. Financial advices are such matters in which people want the best. When you turn on your T.V, radio or surf internet, you will find thousands of financial advisers who give advices for your investment (both short term and long term) daily. So do you think anyone can come tomorrow and offer you advice on your financial investment!!! Even your next door neighbor can give you some financial advice, hot tips or inside information. But alas, the thing is that all advices are not fruitful; and majority of advice offered is useless. There are many fast talking financial advisers in this world but unfortunately; over 90% of financial advisers, financial planners and brokers give advice which is suitable for them. In my personal experience, I have seen stock brokers who don't invest their own money in the stock market; they simply feed fat on clients and investors. But one key thing to remember is financial investment advice is not a play of bug and bunny. There are many strategies and planning in investing money. Set of rules should be followed by financial consulting companies and some of the very basic rules that need to be followed while forming investment decisions are: The rate of recurrence of payment of your interest (monthly, quarterly or yearly) needs to be kept in proper manner. If people do not have the time or knowledge to invest directly on shares and monitor the proceedings, they can invest on unit trust financial consulting company as well. Investments that are estimated to be extremely risky should be avoided, at least when one starts an investment. - A specific portion of income requires to be put away as savings on a monthly basis. A portion of all increments should also be saved. This helps people build a decent stock of wealth over time.
- The fundamentals to have a loan from different sources like banks or any finance companies should be thoroughly understood. The foremost thing one needs to know the difference between the quoted 'nominal' interest rate of finance source on loan amounts, and the actual 'effective' interest rate that is charged.
- The costs and value of the different investment products need to be considered and understood. A detailed lay out of the different components of the total cost should be calculated. Cost levels vary across investment instruments and one should know if they are too expensive or not.
- While making investments, everybody needs to expand their portfolio and it should be ideally, not more than five per cent of one's total invested amount in a single sector. This will protect against any potential drastic losses due to a severe depression in a particular segment of the market.
The points which are given above are some of the simplest financial investment advice, which a financial services provider or advisor might provide you with. These would help you to a great level and will ensure you that the investment decisions you take are correct, profitable ones.
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