You need the best investment guide that you can find in a chaotic economy and this difficult investment environment. You also need a good guide to investing for beginners to navigate coarse waters in front. Investment has never been more difficult or confusing. It’s time to learn how to invest, and this is how to do it.
First, you must handle the investment universe including investment that you might have. It’s not difficult if you have a good investment guide, because there are only 4 basic investment alternatives out there. Second, you have to learn how to invest and collect a good investment strategy that will work for you in good and bad times. That is a good guide to invest for beginners for you.
In other words, learning how to invest successfully in the long run is a two-step process. Pass the number one step and you will not understand step two. Without step two you will not be able to place the investment knowledge you learn in the first step. In advance I stated that now is a difficult time to invest. Now I will support it with a 35-year investment experience, in terms of 4 basic investment alternatives available for all investors. Consider this Mini Investment Guide and wake up call. Investing for beginners is not a picnic today.
4 Alternative your basic investment in the safest sequence for risk: safe investment, bonds, stocks, and alternative investments. Safe investment such as bank accounts and money funds pay interest, and today they don’t pay much. Score at the end of summer 2010: 1-year. CDS at a price of less than 1% and less than 55%, or one-twenty 1%. This is not normal, and is actually really scary. The government can hardly encourage lower interest rates to stimulate the economy as they have done in recent years. We have seen zero interest rates on the money market.
To get a higher interest income of 3% or more, the average investor transfers money into bonds in the form of bond funds, which is not a truly safe investment. Simply put, when interest rates rise, the value of bonds goes down. It’s basic investment facts you can rely on interest rate risk. If you believe that interest rates will fluctuate as they always have and will rise in the future that is not too far away, bonds are not an investment alternative right now. With two and two to go, we move to risk options involving assuming ownership risks to get a higher return.
Each guide to invest for beginners can show that the average, in the long term, shares have returned around 10% per year. The problem is that for the past 10 years, the average investor will do better with its money in a safe investment in the bank. And for the past 3 years, losing around 10% a year is common for stock funds that invest money for millions of people on average. Investor’s belief in the economy and the stock market is not high, because billions of dollars are pulled out of stock funds and moved somewhere else (binding and money funds) to seek greater security.
In the past when high uncertainty and belief in the stock market was low, smart investors turned to other investments (alternatives) such as real estate to find opportunities. It has become a problem this time, because the financial system does not seem to be able to get the traction needed to move back. High unemployment will not be lost and millions of mortgages “under water”, when people decide to just leave their financial obligations. Gold and silver have been done well compared to other investment alternatives. If history is a guide to invest, it’s not a cheerful record. People buy and hoard gold during fear and despair.