Getting rich can be very hard work. It requires skill and patience to earn wisely by investing. Building wealth has emerged as the primary goal for many, especially today due to the increasing cost of basic necessities. There's a famous saying that higher the risk, the higher the reward. Using this principle, a person can create a wealth by investing hard-earned at places that yield promising returns.
Because not everyone is fortunate enough to win the lottery or inherit a large sum of money, the less fortunate tap to alternative means. Investing in stock market is one such place where an individual can make handsome money by investing. Investing in equities is indeed a great way to earn money and create wealth. But investment in equities require knowledge and skills.
Though equities opens the doors for surplus profits, it can also take away money if not done right. According to Warren Buffett's rule of investing: "The first rule of an investment is don't lose (money). And the second rule of an investment is don't forget the first rule."
The strategy of research with adopting a long-term approach and the focus is fundamental to creating a wealth. Building wealth is a long process and it requires efforts. According to Sooraj Singh, founder of Get Together Finance (GTF), jumping into the market without skills will result in losing money.
"Most crucial thing is to have the basic concepts clear. The path from knowing nothing to understanding how equity market works will make things work," he said, adding that "make smart and tested moves in the market that mitigates the risk to a minimum".
"Going with tried and tested theories and techniques to make money can make differences. Having a positive trade psychology is necessary so that an individual does not fall into the trap of greed and revenge trading," Sooraj added.
Sooraj explained that it is essential to have some money from monthly income to set aside in order to make it work in your favour.
"If you delay savings, you are depriving yourself of the means necessary to achieve financial security. Buying the right investment to create a diversified portfolio, trying a simulator before investing real money and staying committed to long-term goal will help you sail trough," he said.
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