Basic rules for investing

New Year, New Hopes and revisit some basic investment rules

First of all Very Happy and prosperous year 2013 to all of you. New year has already begun with new hope and optimisim in equity market. Yesterday, Nifty and Sensex were closed at 2 year high and now the market sentiments appear quiet positive in near term. Today I will not write lengthy article. At the beginning  of year, it is important to make some financial resolution and don’t repeat past mistakes.

There are few basic investment rules of investing and I am sure many of those rules you already know. I am attempting here to those rule revisit in very compact manner.

1)   Before make any investment decision, first know your networth.

2)   Be clear about your financial goal and honestly asses your needsand income

3)   Don’t investment in hurry and never investment in those products which you don’t understand

4)   If you have not properly insured then calculate your actually needed insurance cover and purchase term insurance online if possible

5)   Purchase mediclaim policy and personal accident policy also as it is very important

6)   Understand your risk appetite. If you cannot see 25% value erosion of your portfolio then stock market is not right place for you.

7)   If you are near about retirement please keep away from ULIP and insurance like product and reduce your equity investment and increase debt portfolio.

8)   Track your portfolio time to time and change your asset allocation according to time frame of your goal and market condition.

9)   Always pay your credit card bill on time as it has very high interest charges.

10)                If you feel any problem to understand or you have not enough time to take care of your investment find one financial planner and discuss with him about your financial planning and doubt.

There are much more basic rules and we will discuss about them this entire year in detail. Once again I wish for all of you a very happy, Healthy and prosperous year.

Regards,

Arvind Trivedi

Certified Financial Planner

arvind.trivedi79@gmail.com