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6 tips for the novice investor

April 19, 2020

If you want to start investing your money, and you need guidance to carry out your first operations, we share a guide in 6 steps to get started.

4 min read

The opinions expressed by collaborators are personal.

6 tips for the novice investor6 tips for the novice investor

Entering the world of investments generates great interest for a growing number of people, whether as a means of additional income, financial independence, putting their money to work, securing their savings or preventing themselves from economic contingencies. Whatever the case, this world is vast and can be intimidating to some people, for appearing extremely complicated.

If you want to start investing your money, and need guidance to carry out your first operations, M2Crowd , a collective funding platform for real estate projects, shares a 6-step guide to get started as an investor.

1. Determine an amount and forget about it

Investing is different from saving: it represents acquiring an asset that will generate a profit, but for long periods of time you will not have access to that money, so it is better not to make plans with it. If you invest in a business, it may have lower than expected losses or income; Your investment in the stock market could present red numbers or that real estate development where you invested could be delayed for a couple of months. It is best to start with an amount that you are comfortable with and that does not compromise your basic expenses.

2. Identify what type of investor you are

To start off on the right foot in the investment world, you need to know what level of risk you are comfortable with. Do you want your money to start working, but do you stress losing or disposing of it for a long time? You have a conservative profile: Do you want to start receiving higher benefits than those offered by the bank and are you comfortable with separating your money between 1 and 2 years? You can consider yourself a moderate investor : if you are interested in high profits, and you are not scared of the possibility of losing a good part of your money, you enter the category of bold or aggressive investor : if you are starting, but you want to see the best benefits of investing, You should place yourself at a moderate level, while learning more about this world. Do you want to know what type of investor you are? Answer these questions.

3. Put your money in the right places

If you are starting and have a conservative profile, you are interested in having more or less stable earnings without taking many risks, an investment in CETES, the products of your bank or an insurer is the right thing: although their benefits are low, they allow your money don't lose value. If you are in a moderate range, debt bonds are a good option, real estate (where you can place moderate amounts in crowdfunding projects) or metals, such as gold and silver.

4. Understand and identify the risk of an investment

Calculating risk means knowing how likely you are to lose money rather than earn it. This always depends on external factors, such as interest rates, market volatility, currency prices, business losses, changes in an industry, project delay, etc. This will essentially serve to make the decision of whether it is a good time to make such an investment, and whether you have the resources to take on that risk.

5. Diversify

Diversification is a key concept in the investing world. We colloquially say that it is not good to “put all your eggs in one basket”, since we run the risk of losing everything in the event of a market contingency. Creating a portfolio with different levels of risk, terms and items will balance your money between security and earnings. Real estate, for example, a good balance between security and performance; You can combine it with very conservative alternatives, such as CETES, and have another amount in variable debt or the stock market, with greater risk, but also greater opportunities.

6. Learn constantly

Knowing better the instruments you use, being aware of new market trends or investment options that did not exist before, and learning about more ways to invest, will allow you to grow as an investor and have a greater variety of instruments at your service, will help you make better decisions and feel comfortable with higher levels of risk.

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