Basic rules of investing
Many investors prefer to make deposits on the Internet. To avoid serious mistakes and increase the likelihood of profit, you should adhere to the basic rules that professionals recommend.
Rule # 1. Formation of the investment portfolio
The investor needs to form a portfolio, from which the money will be directed solely to deposits. It must be sustainable so that capital is always sufficient to invest in one or more projects. Otherwise, if a profitable business is found, money for investments will not be enough and a good opportunity will be missed.
Rule # 2. No restrictions on withdrawals
Investors should not constantly invest all funds in projects. Part of the profit earned should be used for their own needs. Limitations to withdraw money should not be, if the amount is not taken from the investment portfolio. The fact is that investing is a risky activity, at any time a depositor can lose money. Regular withdrawal of funds will help to avoid the complete loss of all money.
Rule # 3. Real assessment of solvency
The investment portfolio should include cash, the loss of which will not seriously affect the financial well-being of the investor. Otherwise, the loss will be difficult to transfer psychologically. In addition, the depositor needs money for personal needs. We must really assess our solvency and have more than one source of replenishment of the investment portfolio.
Rule # 4. You can not invest borrowed funds
No matter how reliable the HYIP project seemed, its participants can not be sure that the profit will be paid. In addition, the amount of debt will increase. Investing borrowed funds can lead a depositor into a debt hole, getting out of it will be problematic.
Rule # 5. Expenses should not exceed revenues
With the growth of profits, investors often begin to spend their investment portfolio without leaving a sufficient amount for investments. And the costs go not to an important matter, but to unnecessary purchases. Avoid this situation, you can clearly plan all the costs, the amount of which should not exceed revenues. Each contributor must train in himself this quality of competent financial management to achieve the set goal, otherwise saving savings will be impossible.
Rule # 6. Diversification is the source of success
Investors call this rule “the golden rule of the investor”. It is compulsory to comply, regardless of the circumstances. In accordance with it, the investment portfolio should be divided among several projects, the number of which should be from three to seven. All available savings can not be invested in one HYIP, how beneficial its conditions would not seem. Any chosen site inevitably crashes with time, as a result of which all investments are lost. Simultaneous cooperation with several companies will help minimize risks.
Rule # 7. Regular withdrawal of funds
Reinvestment of profit may not yield the desired result. Unforeseen circumstances can occur in any company, as a result of which the investor’s savings will be threatened. The regular withdrawal of the received profit will positively affect the formation of the investment portfolio, and will also allow the depositor to use part of the money for own needs. In this case, the loss will not be so tangible. Regardless of the situation, it is better to invest exactly the income received, rather than own means, restoring the initial size of the investment portfolio at the expense of earned money.
Rule # 8. Search for new assets
It is considered unprofitable to invest money for a long time in order to obtain a small profit. Often inexperienced investors invest in one project and all the money they spend is wasted. In this case, the received amount ceases to yield income and as a result, the asset becomes a liability. This situation negatively affects investment activity.
A suitable solution is to search for new assets for investment of funds. This will allow to diversify the investment portfolio and increase the size of the capital. Investors should remember that the amount of operating assets in the portfolio will depend on the amount of income that they can expect.
Rule # 9. Remember that there are no 100% guarantees in investing
No investment project is able to guarantee a cash return with a 100% probability. Most programs look reliable and provide beneficial terms to customers. However, this does not guarantee that the investor will make a profit. Do not pay attention to the stability of the results for a long time, as in the future no one can promise to save the profitability of the company.
It should also be taken into account that along with the size of the possible profit, risks also increase. HYIPs, which guarantee that investors 100% will receive a large income, are scammers. Investors should be ready for losses, starting each new project. It is important to make sure that profits exceed losses, and then your business will be successful.
Adhering to the above investment rules, the depositor will be able to cope with all the difficulties in this complex and risky activity.