The Basics of Investments

[RealNoblee]

1. Understand the Business You’re Investing In
Be its anything, coins, forex, real estate, etc. Always ensure you have satisfied yourself by making a proper research and understanding of the proposed investment in question.
I’ve not just heard stories, I’ve seen it with my own eyes. Someone bought a Keke (tricycle) and gave it out for hire, hoping to get returns weekly or monthly depending on his agreement with the rider.
But guess what? It was problem after problem. One day it was the crankshaft, the next day it was "local government wahala."
It even led to an arrest and things got messy just because someone wants to reap the fruit of another persons labor
Now I’m not saying Keke business is bad, but you need to understand how it works so you don’t end up stressed and frustrated.

2. Investment Is Not a Get-Rich-Quick Scheme
If you’re thinking investments will blow overnight and make you millions instantly, you're likely walking into a trap. Real investing takes time. The legit kind is long term and is meant to bring in steady income over time unless of course, you’re looking for Ponzi (which I don’t advise at all).

I think these are the two most important points and all the rest are rather irrelevant. Starting with point two, many people see in the media and movies that people put one sum of money into an investment and get super rich from it - but that is extremely rare and not how most people find success. Success for the average person is a long road that requires commitment and understanding that they should keep adding funds through good times or bad. It takes most people decades of investing before they will be able to enjoy the fruits of their labor, but when it comes it is abundant enough to retire on. As for point one, 99% of people would do much better just investing in diversified ETF funds rather than trying to pick individual companies because unless you have the time to research them you will be wasting money.

Yes,
Another point to note is not engaging in any form investment with borrowed money because the end result might not be pleasant.
Unless there is a constant flow of cash from other sources.

[gunhell16]

Overall, what I saw from this topic that Op created is that it is important that we should be knowledgeable about Risk Management, especially if we are talking about investment
or doing it in our personal lives.

In general terms, investment is a very broad topic. And there are only two ways our capital can be directed here and that is,
it can grow and it is also possible that our capital will not grow or lose.

[Dunamisx]

Let's try our best in knowing about what we want to invest in, because nothing everything we see are profitable assets, some are liabilities and we don't know, we should try as much in making research to know more about these right from the start, so that we don't end up losing our investment on what is not profitable for us, learning to know what to do and taking measures to minimize the risk is very important before investment on anything.

[asarfiar]

Overall, what I saw from this topic that Op created is that it is important that we should be knowledgeable about Risk Management, especially if we are talking about investment
or doing it in our personal lives.

In general terms, investment is a very broad topic. And there are only two ways our capital can be directed here and that is,
it can grow and it is also possible that our capital will not grow or lose.

Preparing yourself for any investment is a very difficult thing. Not everyone can sustain themselves here. The more risk you take in life, the more profit you will have. The most important thing to pay attention to when investing is to gain more knowledge about risk management. Some investments may make you profit and some may not. Suppose you invested in a shitcoin but after a few days you saw that the investment money, i.e. your principal wealth, has also been lost. This is actually usually due to inflation in the world market.

I have generally seen that investing in Bitcoin is a major investment place for me than investing in other areas. If you invest here, you will be able to enjoy the right to earn a good profit after a long period of time. Which is much more suitable and safe than any other investment.

[salad daging]

2. Investment Is Not a Get-Rich-Quick Scheme
If you’re thinking investments will blow overnight and make you millions instantly, you're likely walking into a trap. Real investing takes time. The legit kind is long term and is meant to bring in steady income over time unless of course, you’re looking for Ponzi (which I don’t advise at all).

This is what we often find in my area where they think that investment is a get rich quick scheme, so they get trapped and end up being cheated with a large amount - this is not a small case but a lot.

Where the fake investment offers an unreasonable percentage, let's say ROI per day 10% 10 months can be 100% more profit that he has without doing anything just sitting and continuing to deposit his money, but you know most of those who get caught in this fraud where they do not understand investment at all, what is in their mind is investing and then getting profit.

[jaberwock]

Overall, what I saw from this topic that Op created is that it is important that we should be knowledgeable about Risk Management, especially if we are talking about investment
or doing it in our personal lives.

In general terms, investment is a very broad topic. And there are only two ways our capital can be directed here and that is,
it can grow and it is also possible that our capital will not grow or lose.

Even though it seems that there are lots of factors that also relates with risk management, I think there are still some on his list that are worthy to mention like being patient for example. Speaking of patience, this can be almost everywhere but risk management is mostly about investing literally in appreciating assets and then when building a business.

As you said, investing is broad but you forgot that there are also investments that doesn't make us lose but only to gain something like a knowledge for example if we invest time and effort on learning a new skill. If there's mainly a money that is involved, we might lose it but I'm sure that we still can gain something like experience, and this might help us to improve, so we should not totally feel bad.

[Pablo-wood]

Let's try our best in knowing about what we want to invest in, because nothing everything we see are profitable assets, some are liabilities and we don't know, we should try as much in making research to know more about these right from the start, so that we don't end up losing our investment on what is not profitable for us, learning to know what to do and taking measures to minimize the risk is very important before investment on anything.

I will like to add this;

DYOR has always been the first step to investment but it seems we have grown into desperation and greed that most time we even see signals of low ROI or possible indication an investment will just be a pump and dump project and we put all our treasures there hoping to become billionaires overnight. The importance of learning cannot be overemphasized, the more knowledge we as investors acquire the more likely we stay on the green ladder. Although losses are inevitable but there are some that can be avoided if only we keep our minds away from greed and follow the principles governing investments in general.

[Mrbluntzy]

In the place you discussed about losing it all, I guess you are referring to altcoins investment or not, you can correct me if am wrong, if you are not talking about altcoins investment, then what asset are you saying that an investor can lose their money? Bitcoin that we know has the bullish period and also the bearish period, if you hold your Bitcoin during the bearish period, you didn't lose your capital unless you sell during that bearish period. By right, you are supposed to hold till bull season before you sell.

If you are referring to altcoins investment, it really a big risk in as much as I like to invest in altcoins, I'm very picky and don't invest much, it's just a small amount I risk there because I know the risk involved. For someone that wants to invest in less risk asset, they should remove altcoins from the list.

[TheUltraElite]

All good points, still when it comes to bitcoin, there is no meaning of knowing the business because it is not a business but most altcoins are though.

Which is why altcoins will never go above bitcoin or be profitable in the long run. There will always be bitcoin sitting on top that is what one should aim for.

For stocks though, the underlying business is important. But often people get moved by short term changes in a business which they shouls not be influenced by.

[Marvelockg]

5. Higher Risk Means Higher Reward (and Higher Failure)
Yes, the bigger the risk, the bigger the reward can be but the bigger the failure can be too. Especially in areas like crypto, you are not guaranteed 100% success, no matter what anyone tells you.

this is the part where a lot of investors get caught because they try to risk too much because they want to hit it really big and allow greed to get the better of them. investing much is the only guarantee that you are going to get higher returns but at the same time, it can cause your downfall if you are investing much into a thing that doesn't have the ability to remain valuable for the long term.

the first priority is to know what you are investing in and ascertain if it is something you can risk too much into. if it is for bitcoin that has proven to have a high chance of remaining relevant even in the long term, you can afford to remain invested with a huge amount before being afraid of the possibility of encountering loss. other than that, investing in things like an altcoin, meme coin or even an asset that is not in the digital form and you are not certain of it long term potential, you should never invest when a huge amount.

6. You Can Lose It All
You may have genuine intentions and a good heart, but that doesn’t stop life from happening. Timing, market crashes, bad seasons they happen. Be ready for it, and don’t take it personally when things don’t go your way.

real asset doesn't just go extinct like that, it takes time and often time, most investors that are smart enough will easily dictate when such is about to happen and exit at the right time without getting caught unaware. if you are invested in an asset that can cause you an 100% loss, then you are gambling and not investing. there should be an extent of security in whatever asset you are holding which gives you confidence that you will never go completely bankrupt no matter what.

[hyudien]

2. Investment Is Not a Get-Rich-Quick Scheme
If you’re thinking investments will blow overnight and make you millions instantly, you're likely walking into a trap. Real investing takes time. The legit kind is long term and is meant to bring in steady income over time unless of course, you’re looking for Ponzi (which I don’t advise at all).

I have seen a real example of someone who was tempted by the illusion of getting rich quickly through investment even though he did not have a basic understanding and knowledge about investment, you could say he was one of the victims of the sweet talk of influencers on social media. Yes I agree with you don't expect to get rich quickly through investment because investment is only to build wealth little by little not to create miracles overnight.

[uchegod-21]

.

Final Note:
At the end of the day, investing is a journey. It comes with risks, rewards, lessons, and sometimes losses. Just make sure you’re informed and intentional. That way, whether it works out or not, you’ll know you moved smart.

I like this; investment is indeed a journey and not something you jump into today and jump out of the next day. That shows that you are very unserious and stand the risk of losing your capital if you are not lucky. Still on this, if anyone comes claiming you would see huge returns on your investment in just a few days, they may be right, but be very careful and do your findings before going ahead with any investment.

Investment needs patience, commitment, and dedication. If you don't have all or any of these virtues, then you should consider being just an employee rather than losing the little capital you've managed to gather for yourself.

Finally, I will add that you don't just go into an investment simply because others are doing it. When you look at successful investors, you may not really know what they've been through to get to that level you admire. Every prospective investor must learn a few things about what they intend to invest in before investing.

[Felicity_Tide]

@OP, the points you've made are quite on point and accurate.
Investment is like a journey where you don't necessarily have to learn everything at the start of the journey, the entirety(process) of the journey would bring the necessarily experience. I think people who start their investment in a gradual process, while seeking for knowledge, information and advise from others often get this basic concepts quick than others.

And in the part where you mentioned "Know when to withdraw" should have being "Have your own time frame". Investors or those planning to investor should have a time of investment, like time frames for a long term or short term investment. And time to start taking profits as well when due. These time frames doesn't necessarily have to be a specific time. It can be a range or a rough time. Every investor just needs to be strategic, but using their own strategy that works for them.

[yudi09]

-snip-

Final Note:
At the end of the day, investing is a journey. It comes with risks, rewards, lessons, and sometimes losses. Just make sure you’re informed and intentional. That way, whether it works out or not, you’ll know you moved smart.

A journey that starts with a decision. Investing is a smart move made by people who know how to plan for the future to achieve financial freedom.
The greater the risk, the greater the opportunity to succeed if you know how to deal with it. Nothing is easy in every journey and people only see the results we receive not the process we go through.

Moving in silence without the need for audience applause is more attractive to future entrepreneurs without unwanted distractions by competitors.

[Ruttoshi]

Don't invest in the line of business that you don't understand that much because your friend is making profits from such business and you feel that it will work out the same way for you.

Investment is like planting a tree and nurture it from small till it grows and start bearing fruits. When it has started bearing fruits, you don't harvest it immediately but wait for the right time to harvest. Only people with patience and discipline can endure whatever challenges that is attached to that investment and overcome it. to make money is not something you can do in just one night.

[Rruchi man]

Final Note:
At the end of the day, investing is a journey. It comes with risks, rewards, lessons, and sometimes losses. Just make sure you’re informed and intentional. That way, whether it works out or not, you’ll know you moved smart.

I will like to add this:

"Never be under pressure to invest."

Pressure to invest can come from friends or family investing, and then you are under the pressure to follow them investing without you conducting your own research. Invest now, research later should not be your strategy when it comes to investment.

[Free Market Capitalist]

The basics of any investment starts with financial education. One must be financially literate to embark on any business venture. This is the minimum entry requirement even before we begin to talk about the other key principles that have already been mentioned, like risk awareness, diversification, patience, strategic withdrawal, and others.

Yes, to me in this thread, or rather in the OP I would have missed some more of the basics, like having an emergency fund. Some people jump into investing as if they are going to get rich quick without having the basic knowledge of personal finance. Any knowledge after them welcome. But if you don't follow some basic rules, they can give you all the advice they want, you are not going to succeed.

[Baki202]

Let's try our best in knowing about what we want to invest in, because nothing everything we see are profitable assets, some are liabilities and we don't know, we should try as much in making research to know more about these right from the start, so that we don't end up losing our investment on what is not profitable for us, learning to know what to do and taking measures to minimize the risk is very important before investment on anything.

All these issues of people not finding out about what they are investing in are what is keeping a lot of people away because the majority of them don't even have goals all they want to do is just look at something, and the next thing, they are already investing. From the beginning, I think people need to have plans because when you don't plan, then what is the essence of the investment? There are people who are making good money from the same investment that you will not make anything from. we need to know how profitable the business is going to be and how much you are going to be making from it. So these are all part of the investment plan. Do research and then have an investment plan.

[Jawhead999]

All investments have their own risk, the difference is, people who understand the investment is knowing the risk they might get.

Investing in Bitcoin as the example, people who not learn Bitcoin might purchase it through centralized exchange and stake their coins in there, after 2 years it's still safe, so they think it's safe. But in the next year, the exchange got hacked and they lost all the coins.

If they know if hardware wallet is the safest place, they won't lost their coins.

It's about knowing all the possible risk and figure it how to solve if you get that risk.

[GigaBit]

There is no alternative to investment to be financially successful. If someone does not invest, then he will not be able to profit there. Again, there is no certainty that a person will make profit even if he invests. There are many things associated with investment. Some people try to profit from their investment quickly after investing. On the other hand, some people may lose their money after investing. By investing, a person can gain various types of knowledge in financial terms, similarly, he can also gain various business knowledge. Just as there is risk in investing, there is also good reward. If a change in financial terms is expected, investment should definitely be the best choice. It can educate people on various aspects.