Investing For the First Time: What to Do in a Shaky Market

Posted December 20, 2009 by Bernz

The past year has represented one of the most volatile and risky eras in investment history in the United States, especially in the stock market. For those with existing investment portfolios, watching the decline in market value every day has been demoralizing. Retirement asset values have been slashed and many investors are wondering if they will even be able to afford to retire.

investingoct

But what do you do if this is the very first time that you are investing? You may be just graduating from university or trying to put away some money for your children’s college tuition. How can you ensure that you make good decisions in this shaky economy?

1) Find the right advisor. An effective investment advisor knows the current state of the market and can help you understand the risks and rewards of each of its sectors. Choose an advisor who does not earn income based on how much or what types of investments you buy. Your investment advisor should also be experienced. This recessionary financial market is no time for you to try out a wet-behind-the-ears advisor.

2) Don’t invest all your money at the same time. With the uncertainty in the markets today, it is wise to invest small amounts at a time and keep some cash back to protect your capital. The market can turn up or down at a moment’s notice and investing at intervals reduces your risk of following the market down.

3) Invest in different market sectors. This is the same advice as the age old “don’t put all your eggs in one basket”. It is especially important in the current market to diversify. That way, if any one market sector tanks, you have assets working in other sectors to make up for it.

Investing for the first time can be scary at any time, but even more nerve-wracking with the roller coaster market of 2009. Getting the right advisor on board and taking your time to place your investments can help you make the best of today’s investment arena and position yourself for growth in the future.


More On This Topic:

Is This the Market of a Lifetime?
Is This the Market of a Lifetime?
With total stock market indexing your investment goes a long way
With total stock market indexing your investment goes a long way
Dogs of the Dow- Investing Strategy That Needs to be Retired?
Dogs of the Dow- Investing Strategy That Needs to be Retired?
What to Do if Your Stock Portfolio is Down 40%
What to Do if Your Stock Portfolio is Down 40%

Leave a Reply

(required)

(will not be published) (required)


« Back to text comment

Disclaimer:

All the articles and content written here on Invesmint.com is for general information only and based solely on the authors personal opinions and discretion. It was not and should not be a substitute for professional advice. Visitors of this site (Invesmint.com) are encouraged to seek appropriate professional advice before acting upon the content or information from this site. Again, the content of this website is not a source for professional advice.

INVESMINT.COM hereby excludes liability for any claims, losses, demands, or damages of any kind whatsoever with regard to any information, content, or services provided at our web site, including but not limited to direct, indirect, incidental, or consequential loss or damages, compensatory damages, loss of profits, or data, or otherwise.