Use our UK Finance guide and learn by experience. We outline pitfalls so that you don't have to learn the hard way, as many of us often do.
Sound Advice
Hold onto Appreciating Assets
When it comes to the subject of money, the saying "a rolling stone gathers no moss" is so true. We discuss a few scenarios in investment and strategies in dealing with appreciating assets.Businesses
Many entrepreneurs buy struggling businesses that have great potential often at discounted prices, turn them around and sell them for vast amounts more than what they pay for them. This however is not for the faint at heart.
Property
Rental income that streams in over the years to property owners has been shown for centuries to be amongst the most consistent, reliable and predictable of all income.
While there are speculators who made a lot of money from quick buying and selling in property, seeing property as a long-term investment is bound to bear fruit.
Stocks and shares
The majority of people who made significant fortunes by investing in stock and shares did so by buying blue chip shares and holding onto them for long periods of time.
It is not about keeping on the watch for shares to buy and sell quickly. Simply buy and hold – and keep at it. The average holding period for which shareholders of Berkshire Hathaway (the legendary Warren Buffet's company) hold their shares is 15 years. Warren Buffet has never sold a single share in Berkshire , which incidentally he bought at $7,50 per share and today it trades at $70 000 per share!
American authors all concur: "wealthy People "rarely move from one investment to another. Successful people achieve wealth by buying investments and then leaving them alone for very long periods".
Mutual funds
A mutual fund is a fund operated by an investment company that raises money from shareholders and invests it in stocks, bonds, options, commodities, or money market securities. These funds offer investors the advantages of diversification and professional management.
By authorising a monthly debit order in favour of a mutual fund, investing can become fairly easy. Other people believe the investor loses control and prefer to manage his or her own investments - you decide.
Gold coins
Many people believe in gold coins as an investment. Again, they buy it, lock it in a safe and forget about it.
No matter what kind of asset you decide on the trick is to buy and hold.
