5 Things to Consider While Diversifying Your Wealth
We should not forget the relevance of a well-diversified investment which is a life savior in any market condition.
“Risk comes from not knowing what you are doing.” - Warren Buffet
A diversified portfolio relates to not putting all your eggs in one basket – this is the central concept of diversified investments.
Define Your Objectives and Identify Your Risk Appetite
Financial Roadmap: You must assess your financial situation and evaluate your income, expenses, liabilities, assets, lifestyle choices, and cash inflow before defining the type and frequency of investment you want to get into.
Investment Distribution: It is imperative not to invest your entire wealth or corpus in a single investment scheme.
Emergency Fund: It is substantial that you keep an emergency capital so that you never have to borrow. Converting all your liquid funds into long-term investments is not ideal.
Go for quality, not quantity: It is not wise to invest in several schemes. Instead, be selective and pour your money into a few but lucrative investments.
Investing should not be troublesome; it should be fun and something you look forward to.