Investment is considered one of the best ways to save money and achieve financial goals. But sometimes people believe in myths about them and refuse to risk their savings. It is important to collect proper information about the investment procedures before rushing into any decisions. People must take opinions from professionals and other experts before spending their money on investment or the area of stock markets. Another important aspect is calculating the risk factors. Some of the investment myths are mentioned below:
- It is too risky:
We have to accept that investing the money is not safe but we can calculate the risk factors and can avoid them to earn profits. Different types of investment options are available in markets that are segregated according to their risk factors. People can easily find and choose from high, medium and low-risk investments according to their financial goals. The concept of SIP [systematic investment plan] is popular these days. One can calculate the returns using the mutual fund SIP calculator for safe investments.
- Investments are complicated:
People always believe that investments are complicated but we can choose our methods and make them simple. One can decide their procedure of investment and can invest their savings according to their financial goals. Various options are available in the market for proper investments, some are complicated and others are easy.
- Savings will secure your future:
Savings can secure your future and help you to achieve financial goals but it is the first step. People should understand that they have to keep investing and saving in schemes, plans or products to achieve financial security and a safe future.
- You should be an expert if you want to invest:
People interested in stock markets must collect the required information about it before investing. Other options of investment require general information and one can start investing in them after collecting the information. We can also take advice from market experts for help.
- You have to monitor your investments daily:
People can choose a multi-asset fund for investment and check them according to their comfort. Multi-asset funds are considered as one of the easiest and low maintenance funds.
- You should know when is the right time to buy:
Stock markets and options for investment are governed by many factors. It is difficult to monitor them daily so one can start an investment as soon as they can easily manage and should keep their money for a long time in the market to earn higher returns. One should be clear about the thought of long term investments and can seek professional opinion for it.
People investing in particular schemes or markets should consider risk factors properly and must seek professional opinions for it. There are many types of investment risks. Some of them are mentioned below:
- Currency risk
- Interest rate risk
- Equity risk
- Market risk
- Liquidity risk
- Concentration risk
- Credit risk
- Reinvestment risk
- Inflation risk
- Horizon risk
- Longevity risk
- Foreign investment risk