Thursday, October 29

Financial Services

5 Ways to Ensure Proper Management of Investment Risks

Financial Services

No matter the type of investment you make, there will always be risks involved.

There are many types of investment risks. Even if you entrust your hard-earned money with a reputable company like Truebell Capital, investments will always be vulnerable to different kinds of risks.

Kinds of investment risks

  1. Market risk – economic developments can affect the entire market, causing the value of your investment to decline. The price of your shares, for example, can vary, depending on the demand and supply.
  2. Liquidity risk – there may be times when you will have to sell your share at a lower price or not at all.
  3. Concentration risk – if you concentrate your investment in one place, you are at risk of losing your money. This is why it’s best to diversify, as well as ask for help from an experienced trust company, like TruebellCapital.
  4. Credit risk – your investment could be at risk if the government entity or private company where you invested your money incomes across financial difficulties, causing them to not be able to pay the interest or principal at maturity.
  5. Inflation risk – when the value of your bond doesn’t keep up with inflation, you could lose your purchasing power. But when you commission a trusted company like Truebell Capital to manage your shares, which has some form of protection against inflation, the risk can be mitigated.

Risk management tips

  1. Rebalance

Experienced investors will sell stocks that take up too much of their portfolios periodically. Then, they will buy more of those underperforming exchange-traded funds or stocks. This is a way of buying low and selling high.

  1. Follow trends

Experts advise to only invest in stocks or ETFs that are in an uptrend. You connect a series of higher lows or use a moving average to draw your own trend line. Once the price violates the trend line support, that’s the time you sell.

  1. Diversify

If you have a diversified portfolio managed by companies like Truebell Capital, you’ll be a lot less likely to be exposed to risks. How? If an asset’s value falls, it can be offset by another that’s increasing in value. Check Truebell Capital for more details.

  1. Monitor investments

This can be a lot of work. You will need to keep track of the values of your investments to ensure that you’re not losing money anywhere. And if one of your investments’ value has plummeted too far from its target, you will then need to rebalance your portfolio. To ensure that these are all done right, you need professional help from a trusted company like Truebell Capital.

  1. Focus on your goals

It can be easy to be distracted and discouraged when an asset experiences some volatility. Don’t panic, though. Instead, focus on your goals and study how market volatility affects investment and whether or not it can be regained. Better yet, seek expert advice from a company like Truebell Capital to ensure you’ll be more informed.

You will need financial assistance once you start investing in and managing the risks involved. Get hold of to learn more about investing today!