If you need to avoid your loss possibility happening to your stock portfolio, you need to embrace property investor principle that is location, location and location. It means that you shouldn’t spend all money you have at one location of stock but you need to diversify by placed to various layers of stock.
It is required regarding the unknown market condition whereas no certainty when it up and when it down. If you have already applied diversification properly, there is no needed worry anymore. To diversify well, check these tips out below:
Spread your capital
Capital market is the right place to invest but keep in mind that you should avoid placing your stock in one sector. Find out the company where you will buy the stock so that you will recognize it properly and then lessen the risk.
Consider mutual funds and bond
Consider to invest the two both because beside diversification, you will also need to widen your investment portfolio. Other options, you are also allowed to take investment which has stabile income so that you will protect your portfolio from stock market pressure.
Keep adding the portfolio
Expand your investment portfolio routinely. Even though the value added is not big enough, it is not a big deal. It will become to be bigger and bigger over time. It also could be applied to against fluctuactive condition of market. If already used to add the portfolio value, you will never take care about market condition anymore.
Know when you should out
Buy and keep the investment until a certain limited time. It must need a good strategy. Keep watching the market movement and situation of sector where you hold the stock in. In that way, you will know when you should out.
Pat attention of broker commission
If you rarely do trading, find out the amount of payment you should spend to your broker commission. Several securities ask a monthly payment meanwhile the others asking when there is a transaction. Watch your expenditure as well as income. And keep in mind that the cheaper is not always the best.