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Risk

Past losses do not guarantee future losses

The lay claim that time does not want investment is funny. Especially when we use the comparison with the weather.

Imagine that your mood exactly copies the weather. If it is a sunny day, you are full of life and vigor. However, as storm clouds appear in the sky, your attitude changes to a cloudy mood. The similarity with the current situation on the capital markets is more than similar with bad weather.

It doesn’t have to rain, just crack/h2>
A similar bon mot was heard in advertisements for Harvard funds from the early 1990s. “It doesn’t have to rain, it’s enough when it’s dripping,” was the slogan for investment at the time. Two decades later, everyone is a little more educated, even if the beginning investor knows that high returns are the paradise music of the future. They are not excluded, they only increase the risk of loss. And the investor should avoid them if possible.

How much loss will you withstand?/h2>
However, even high-risk investments do not discourage investors. Just keep in mind that you should not invest all your money in a single investment. It doesn’t matter if it’s a certainty that promises nice returns or an uncertain company that will be duly rewarded in the end.

People who want to secure themselves in old age are in a similar situation, but their age or early retirement plays against them. They have two options. Either they take a taste for risky investments and settle for conservative and therefore lower returns. The second option is a situation where they invest part of their funds aggressively or dynamically.

If they choose five to ten percent for a riskier investment, which they put aside to old age and they understand in advance that they may lose part of their value, everything is fine. Likewise, if centenarian grandmothers on their old knees decide to invest part of their money in buying undervalued shares. They just have to reckon with the fact that they don’t have to wait for the returns.

In all these cases, past losses do not guarantee future losses. If the capital markets are failing now, this is not the case for the future either.

Risky investments even in times of boom

Risky investments are waiting for you even in times of economic boom, when the economy is thriving. Even in these times, it is possible to make a fortune. All you have to do is have big eyes and suppress caution and invest all or most of your money in one asset. As usual, the fall does not have to wait long.