We can divide investors into two types. These are those who like to take risks and those who prefer to play on the safe side. You may ask: why some investors might risk losing their money by taking high-risk investments?
The answer to this question is represented in one of the basic laws in the world of investment, which states, “The higher the risk, the higher the profit rate and the possibility of loss as well, and vice versa. The safer the investments, the less profitable and the less likely the loss.”
This article will target those who prefer to play on the safe side. Before I start giving advice, let me explain something to you. There is no investment without risk. Playing on the safe side does not mean that the probability of losing is zero percent. This will not happen. There is no investment without risk. The summary is that there is always a risk, but its percentage varies from one investment to another.
Here are the tips that will help you play on the safe side with the least possible risk:
1- Investing in Mutual Funds
Mutual funds are considered safe investment instruments with low risk and high liquidity, making them a safe haven for investment.
2- Investing in Large Companies with a Solid Foundation in the Market
Warren Buffett, one of the most famous American investors, says in his book “Investing the Warren Buffett Way” that he does not prefer investing in small companies, but rather large companies that have proven over the years that they are able to withstand economic crises and market fluctuations.
3- Investing in Companies that Produce Basic Commodities
Investing in companies that operate in the commodity sectors such as food, health, and other necessities is a safer haven than companies that specialize in producing luxury goods such as cars, cosmetics, and other commodities that can be easily dispensed especially in times of crisis.
4- Investing in Education
Education is essential to support and protect your investments. Beginners who have limited investing knowledge and rely on their luck in investing are very likely to lose their money.
So what is the solution? Simply start learning, learn the basics and rules of investing. This will help you understand the right companies to invest in and the right time to buy and sell and other basic things that must be learned, and fortunately for us we live today in an era where it is easier to obtain information compared to the past. To open the browser and search on Google and find thousands of books and articles that explain the foundations of the investment process, education today only costs you some time and effort. In exchange, you will gain the ability to manage your investments, protect your money, and record huge profits.
This was not written by Thndr and this is not investment advice, you should do your own research before making investment decisions.
