Seasoned investors are always looking for new areas through which they can grow their capital and make superior returns. Investing in the global markets allows them to do exactly that because it lets them buy and sell shares and commodities on an international scale. It has been made easier and much more convenient through online trading. However, investing in global markets can be daunting. How do you ensure you get it right?
Here are a few tips to get you started.
Create an Investment Plan
Before undertaking any investment activity, you need to assess your goals, risk appetite, investment horizon and the amount of capital you are willing to invest. This will help to create a portfolio that meets all your needs and gives you the returns you are after.
Get a Trusted Investment Partner
The global markets have the potential for superior returns. However, there is also the possibility of losing your capital to unscrupulous players. To shield yourself, partner with a credible fund manager that is licensed by all the relevant statutory bodies. Before entering any arrangement, do your due diligence and verify the credentials of the firm. Examining its performance over the years will also give you more insight into its trustworthiness.
Invest in Multiple Asset Categories
It is important to diversify your portfolio by investing in more than one asset class. This lowers your risk and protects you in the event that an asset underperforms since you have others to fall back on. While this can be expensive to undertake by yourself, engaging a fund manager will let you access a wide number of assets with little capital.
Gain an Understanding of the Dynamics of Global Investing
Aside from the usual investing considerations, there are other factors you need to understand if you decide to venture into the global markets. Your choice of investment partner matters because you need them to be experts in various markets, investment trends, and other areas, such as political stability and the various economic policies that govern these markets. However, if you choose to take this journey by yourself, you must teach yourself about these issues so that you are able to make informed investment decisions.
Investing requires patience. As Dennis Gartman advises, be patient with winning trades and enormously impatient with losing ones. A useful rule of thumb is to keep your losses small and profits large. With this formula, you will be able to earn good returns even if you are ‘right’ only a third of the time.
Investing in the global markets by trading online has the potential to earn you superior returns. Depending on your investment needs, you may undertake it by yourself or engage with a trusted fund manager. Regardless of the approach you choose, it could definitely take your investing to the next level.
This article was written by Egla Kerubo, Marketing & Communications Analyst at Standard Investment Bank.
Get in touch with Egla on email@example.com