The main objective of any investor is to grow wealth over time. As much as we want, there is no computer algorithm or secret formula that can help in building wealth. The best we can do is to learn successful investing skills.
One effective way you can learn the art of making winning investment moves is by paying attention to ‘smart’ investment habits of high net-worth investors such as Jim Slater, Harry Triguboff, Warren Buffet, Neil Woodford, and others.
Here are five habits of successful investors that you can emulate to increase the odds of making winning moves, and grow your wealth.
1. Carefully Assess the Risks
High-worth inventors carefully assess the risks before making any investment decision. They know exactly how much money they can afford to lose at a given time. This should be an amount over which you won’t lose sleep worrying at night.
Risks, according to Warren Buffet, are not knowing what you should be doing. You need to know exactly how much you can afford to put at stake. In addition, you should know the money that you should make by investing in a particular avenue.
2. Become a Specialist
To succeed in the investment world, you should know more than the average investor. Jim Slater had coined the phrase ‘The Zulu Principal’ to stress the importance of thoroughly knowing about your market. The British investor says that he never made an investment without first carrying out extensive research.
3. Invest in Growth Stocks
Philip Fisher, who had obtained above-average returns over his 74-year investment career, believed in growth investing. In his book, Common Stocks and Uncommon Profits, he states that to be successful, you need have a long-term investment horizon. The short-term horizon should be a tool to achieve your long-term investment. And thinking long-term is equivalent to focusing on growth stocks, instead of value stocks. Fisher had bought Motorola in 1955 that he kept it until his death in 2004.
4. Invest in Gold
High-net-worth investors put money in gold to protect rather than build their wealth. Studies have shown that gold bullion is an excellent hedge against the eroding value of money i.e. inflation. Also, gold is a good hedge against stock market losses. The value of gold doesn’t fluctuate widely like stocks making it a less risky investment option. Companies such as www.goldbullionaustralia.com.au allow you to add gold to your portfolio.
5. Real Estate Investment
Buying real estate in Sydney is another strategy used by high net worth investors. Australian billionaire Harry Triguboff had built his wealth mostly from real estate development. Investing in real estate requires that you have high cash reserves. This will allow you to hold on to higher prices and earn above-average profits. Consider getting the help of investment planning firms like scinvestments.com.au to get in-depth information about the real estate market in Australia.
The best time to invest, according to Warren Buffet, was several years ago. The next best time is today. You should not let the opportunity slip any further. The investing tips from high net worth investors mentioned in this article will help you in making winning investment moves.
