Want to know the 3 golden rules of investing in stock markets? Can you give me your best rules in investing? I am investing in stocks and mutual funds. A readers asked this question. Now, let us just discuss this question with our own opinions. I believe other readers has also rules in investing, please share your thoughts and rules in the comment box afterwards.In life, rules are very important. Rules can make our lives worthwhile. Rules can make one’s life simple and easy. And the best thing is, if everyone has great rules and followed it strictly – no people are poor.
Just like in investing, if we want to succeed we should follow rules. And what are those rules? Many investors has different rules, but are they successful? I think not all of them. Who are the successful? Of course the investors who has rules and strictly following those rules.
Golden Rules of Investing in Stock Markets, Mutual Funds or Any Types of Investments
Let me just share the rules of Warren Buffett when it comes to investing. FYI: Warren Buffett is the CEO of Berkshire Hathaway and one of the world’s richest man. Warren Buffett rule is simple, it is stated as follows;
Rule #1: Don’t lose money
Rule #2: Don’t forget rule #1.
What have you noticed about the rule? Is short, simple and sweet. Of course, you need not to lose even a single cent. That’s the mindset of successful investors. And here’s at InvestmentTotal.com, our favorite rules in investing are;
Investing Rule Number 1: Invest Your Time
Learn, learn and keep on learning. As the old saying goes, “time is the most extravagant of all expenses”. You need to invest your time first. How? By learning “investing”. You don’t have to spend a lot of money before you invest your money. There are free resources wherein they can teach you on how to invest.
Books, blogs, videos, online articles, forums and even seminars are very important. Invest your time with these tools. Buy personal finance books, subscribe to investing magazines, attend investing seminars. Once you’ve learned investing, you will become more comfortable and confident in investing your money.
Investing Rule Number 2: Invest Only in What You Know
You can’t invest in an investment vehicle that you are not familiar with. That’s why in our rule investing number one, we need to invest time to study and learn the different types and investment offers.
It is advisable to invest your money in an investment offer that you know. If you invest in the stock market, you don’t need to ask anyone what is the best stocks to buy this year or next year or the best stocks to buy for long term growth. Just think about a company that you know and comfortable to put your money in them.
Example, if you know the best in electronics industry and you are familiar with Apple, Inc. you might put Apple, Inc. in your stock portfolio.
Investing Rule Number 3: Don’t Lose Your Money
Warren Buffett told us not to lose money as his rules in investing. Do not invest your money if you will just lose it. We are investing our money to make it grow not to lose it. The best strategy if you don’t want to lose your money in investing is to follow investing rule number one and rule number two.
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