To attain, you must first have a strategy to get you there; that sounds so simple and yet it’s a concept that’s so often overlooked. To build your wealth, the same is true, you need an investment strategy. Instead of just guessing about where to invest, you will be more successful if you develop a strategy.
There are no right or wrong investment strategies. Your investment strategy is what helps you attain your personal investment goals. You also have to be comfortable with the risk within your investment strategy.
You may be the kind of investor who uses a combination of strategies; and then again you may just use one. For diversity, perhaps you use one investment strategy in your 401k plan and then another strategy in your IRA accounts.
Your investment strategy depends upon your goals and risk tolerance. You may be the type of investor that buys & holds; which makes you a long-term investor. You may buy and sell, a more short-term investor. To be a successful investor, find an investment strategy that fits you and work within that strategy.
Find Your Investment Strategy
1) Using A Growth Strategy:
- Investing in stocks and mutual funds that specialize in growth and or aggressive growth.
- Stability is not as important as growth.
- The investments used in a growth strategy seek capital gains.
- The investments can be in small-sized companies to mid-sized.
- The stocks and mutual funds that specialize in growth can be international or world funds.
- The prices of investments within a growth strategy will fluctuate more than those in a balanced or income strategy.
- A growth strategy is for investors with a higher risk tolerance.
- A growth strategy is suited for investors who want steady growth over the long run.
2) Using A Balanced Strategy:
- A balanced strategy is the middle of the road.
- It is used by medium risk tolerance investors.
- It’s for the moderate or conservative investor.
- This strategy seeks investments in both stocks and bonds.
- This strategy is for those investors who want both growth and income.
3) Using An Income Strategy:
- Less price fluctuation.
- This strategy is for investors with a lower risk tolerance.
- The stocks and mutual funds within an income strategy invest in preferred stock, dividend paying stocks, investment grade bonds, corporate and government bonds.
- Investors who use this strategy seek current income.
- These investors get their income by receiving dividend payments.
- A strategy for investors seeking stability.
4) Credit Can Influence Investment Strategies
- You will not pay more for your investments if you have a poor credit rating.
- You may have less money to invest because other things will cost you more.
- So one important investment strategy is to keep high credit scores so that you have more money to invest.