What to consider when Investing

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WHAT IS INVESTMENT?

Investment is term as a form of savings. It is the act or process of releasing capital in form of money in expectation of generating income or profit from the use or appreciation of the material.

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Money can be invested as well as man power and likewise properties. Money can be invested by buying goods ahead hoping for an increment in price of the commodity and then resell it to make profit at the end of the sale.

Money can also be invested by buying shares in companies. Buying of shares means using money to buy a percentage of the companies worth for some period of time and at the end of each year, profit generated by the company is share among the shareholders according to each of their share percentage.

Money can also be invested through banks especially commercial banks. Anyone with moneyvthat wants to safe for future use and make profit within that period can approach any bank of his or her choice and open an account with them preferably fixed deposit account and deposit the cash for any period of time. While the money is deposited, banks keep adding interest every month, eventually, when the time elapsed, the depositor can collect his or her savings at the same time the interest which turns to be a profit for him or her.

Man power can be invested in the sense that, one can decide to use his or her power and time to work for someone and get paid at the end of the service. Work rendered to someone is also an investment because he or she get paid for the services rendered and thus, make profit. Properties like Houses, cars, any form of machines can also serve as means of investment.

When a building is constructed by someone and then rent it out to someone else, the tenant have to pay for the rent due and then tends to make more profit for the person that rent the building out to him or her.

FACTORS TO CONSIDER BEFORE INVESTING

Risk and Reward
Risk in investment means the probability to make loss or profit while reward is the profit gained from the investment. In every investment, there is always a risk that is, the chance of making profit or loss. But a reasonable investor should be able to analyze the percentage of the risk and reward.

It can be predicted in relation to the economy at that moment, the community, the government and most especially the demands and supply of what he or she is planning to invest on. If at the end of the analysis, the risk of the investment is bearable then one can further the process of the investment but if the risk is not favorable, he or she should stop the processing of the investment to avoide loss and then change plans or find something else to invest on and make sure that the new investment is favorable before investing on it.

Available Capital
An investor should understand that money is the root of investment. He or she should calculate the estimated amount that will be needed through out the investment and compare it with the money available on ground for the investment. The investment is good to start if the money available will be enough through out the investment and the investment should be canceled if there is no availability of money to run it. Though some investors take risks to start their investment with any amount they have on ground as at that time but its very risk and a game of chance and luck because the time the investment will need more money, there might be no money with the investor and that alone can run down the investment and result in loss.

In the casa of low capital, the best solution is to wait till you have enough capital or find another form of investment that requires low capital and invest in it.

Weather And Climate Condition
Weather is an atmospheric condition of a place over a short period of time while climate is the atmospheric condition of a place over a long period of time. Weather and climate conditions affects the rate at which investments yield. For instance, an investment that involves the production of umbrella, cardigan, sweater, etc. tends to have more sales in the raining season than the dry season because those materials are majorly used in the raining season and therefore the demand will increase during that period. So therefore, any investor planing to invest on a particular product should check the product to be produced in relation to the weather and climate condition of his or her area at that particular time. He or she us good to go if it is favorable while he or she should consider investing in another thing if it is not favorable enough to generate profit for him or her.
Peoples Review About The Investment
Investors should try to learn from peoples views about the investment before investing. It is not very sure to be the first to invest in a business. A lot if people already did and have their reviews about the investment. A new investor should approach the previous investors either physically or online to ask about their review on the investment and their suggestion, advice and guidelines to follow through out the investment. If their review is very good and interested, you are good to start the investment but if in other way round, one should back off to avoid loss.

The Ratio Of Profit To Stress
A good investor should estimate the percentage of profit to be generated and the stress involved through out the investment because some investments requires much stress and at the end of the day, generates little profit. If the expected profit worth the total stress throughout the investment, the investment can be done but if the stress is much more compare to the expected profit, then such investment is not advisable to avoid loss.```
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