In my last blog post I spoke about investing, I spoke about how my investment strategies have changed and evolved since I first started out some 25 years ago, and how my mindset has also had to change. If you are just getting started in investing or are a seasoned investor already but want to diversify, I believe the most important change is to have a mindset shift.
With the growth of the internet and literally having the world at your fingertips now, the opportunity’s for investing across many different asset classes including crypto, stocks and shares has never been greater and in my opinion easier.
Many people in my age group started out investing in property which was a steady stable kind of investment class, but in my experience the youth of today have big aspirations, they want to grow and do something big in their lives and for those that want to delve and look at different types of investment strategies this applies to you, your mindset has to be based on long term investment and growth, rather than a short term hit.
This is what has really helped me with my own investment strategies in recent years, thinkingon a more long term basis, I find this kind of approach and outlook more rewarding rather than focusing on short term gains say for 6 months or a year where there can be a lot of market volatility, for example with BTC, it has now surpassed $100,000 of course it is going to go up, but over the short term it may go back down again to say $40, $50 or even $60,000.That is why I think with this kind of investment approach you are always going to be on edge, will it, won’t it, you can’t really relax.
And because I believe that you should learn to invest at a young age, I am even teaching my children to invest with a focus on long terms gains and growth rather than a quick hit. I let them invest a certain amount in stocks and shares and a little bit of crypto.
I let them do their own homework and carry out their own research into the projects they want to invest in, we all speak about it and discuss it, and I let them make their own decisions with a little bit of guidance.
They are now more aware of the world and what is happening around them, for instance we will now have discussion Elon Musk, Donald Trump, what the UK government is doing, what the economy is doing, so our conversations are very different now to how they used to be.
Even my 14-year-old daughter will message me about say what Elon Musk is doing, whatTwitter is doing, what’s going on with the currency rates, why the dollar is strong at the moment.
I think it’s important to start investing when your young because it’s good to learn and grow, of course there will be losses along the way, but it’s a learning process, and I would encourage every parent to give their children whatever they can spare, let them lose $1000, $2000 but let them learn and have the experience.
However, one thing that is really important before any investment is made, is to have a detailed plan, for example not just that I want to buy Tesla, but why you want to buy Tesla, where do you see Tesla in x years, what are the figures for Tesla, what is their capital income, really do your homework.
If you’ve done all your homework on an investment, and you think it’s the right project then that’s fine. It is also important to know what numbers to back and play with because you will lose, but when you make you will make big, so your mindset must be prepared for the losses as well as the gains and that is why you need to understand what you are backing.
Of course, you will lose, it’s a fact of life, nothing goes straight up, but when you have a portfolio of perhaps 10-20 different projects, you may lose on 1,2,3,4 but you have to look at the portfolio as a whole, I never look at individual projects.
I don’t think investing is rocket science, but people get fixated with one particular coin or stock and they think they’ll back it wholeheartedly, whereas my thought process is if you have say £500 to invest, invest it in 5 different projects so that you are spreading your risk across a diverse portfolio.
You’ve got to start small and learn how to invest because once you’ve learnt the process, learnt how to carry out the research and analysis that you must carry out beforehand, then when the right project does come along you’ve got all the knowledge and experience of say 2,3,4 years’ worth of investing and get your teeth stuck in the right project and potentially make good money.
So, my closing advice to budding investors is to spread your risk, invest in multiple projects to build a portfolio, carry out your research, do your homework just learn about investing, manage your risks, and start small say £50, £100 or whatever you can afford and put it into 5 – 10 different projects.
You are building up a skill set when you are learning about investing, you are learning tocarry out your due diligence correctly and when the right project does come along, you’ll be a lot wiser, you will have made your mistakes and you will understand how to do it better next time.
Once you’ve done your homework you have to be brave and invest and then just forget about it, don’t look at short term gains, there’s no guarantees in life, but if you leave your money in the bank or buy a property over say 10 years the value of that individual property or portfolio will increase but if you invest in other things like crypto or certain stocks and shares, in my opinion they’ll gain a lot more value than with property or gold.
However, I am not an advisor and I emphasise once again that you should always do your own homework before getting involved with any kind of investment strategy and be aware that all investments carry risk.
So, these were my mini pieces on investing, I hope you found them useful and encouraging and until my next post keep focused, keep learning, and keep moving forward.
AD