Have a Plan
If you don’t have a plan, how do you know where you are going, and how will you know when you arrive? Your plan will help you set realistic goals, order your long-term priorities and show you what you need to do. Moreover, it will help you maintain perspective and avoid panic when the next inevitable market or economic gyration occurs. Make it as simple or complex as you want, but make a plan.
Get started – Don’t procrastinate
Making a plan is the first step and the next step is to actually do something with it. Not getting started is the downfall of too many people. No amount of planning will remove all uncertainty.
Let time do its work
Don’t be impatient. Remember, your plan is a long-term one. Let time and the power of compound growth be your greatest allies. Don’t be afraid of starting small. You will be surprised how fast your capital can build.
Understand Risk – Manage it, don’t avoid it
Investing is the art of earning a superior return at an acceptable risk level. What is acceptable? That depends on your circumstances. But totally avoiding risk is a losing game. Concentrate on quality and long-term returns. Try to keep short-term fluctuations in perspective. Stocks, for example, may be volatile but, as a group, have always gone on to reach new highs in the long term.
Don’t buy a stock because it doubled last year and everyone else is buying it; do it because it’s good value and offers excellent upside potential. Watch out for fads. They usually fizzle fast.
Don’t be greedy
As the famous Wall Street quote states: “Bears make money, bulls make money, pigs get slaughtered.” Don’t be angry because you sold your investment when it tripled and watched it double again. Join the millionaires who sold their holdings early, but were content to sell while someone else was eager to buy their shares. Avoid the “sure thing.” Don’t over-reach for yield. High returns sometimes are a sign of trouble. Know what you’re buying.
We hope that all of this information will assist you in starting your own investment portfolio. Now get on the Student Challenge platform and start trading in the Capitalize for Kids Student Challenge Presented by CIBC Investor’s Edge!