Thread
There are 100s of investment strategies.
But you don’t need to know all of them to become a millionaire.
If you want to make money investing, look into these 12 strategies:
But you don’t need to know all of them to become a millionaire.
If you want to make money investing, look into these 12 strategies:
1. Value
This is when you invest in companies whose stock price is lower than it should be.
The idea is that investors will eventually realize the stock is undervalued and invest which increases the stocks value.
This strategy takes time, but it’s often worth it.
This is when you invest in companies whose stock price is lower than it should be.
The idea is that investors will eventually realize the stock is undervalued and invest which increases the stocks value.
This strategy takes time, but it’s often worth it.
2. Growth
Riskier than value investing, growth investing focuses on stocks with big upside potential.
This means you give up dividends, but you make up for it with appreciation.
Something to consider: Growth investing does best during times of low interest rates.
Riskier than value investing, growth investing focuses on stocks with big upside potential.
This means you give up dividends, but you make up for it with appreciation.
Something to consider: Growth investing does best during times of low interest rates.
3. Dividends
Companies will give you money just to own their stock.
But stocks that pay good dividends are usually larger, more established companies.
So you won’t experience much appreciation, but their dividend payments make up for it.
Companies will give you money just to own their stock.
But stocks that pay good dividends are usually larger, more established companies.
So you won’t experience much appreciation, but their dividend payments make up for it.
4. Indexes
Index investing is a hands-off approach to earning the same return as the market as a whole.
It requires minimal effort and research and ensures you always receive the market average.
Some of the most popular indexes are the S&P 500 and the Total US Stock Market.
Index investing is a hands-off approach to earning the same return as the market as a whole.
It requires minimal effort and research and ensures you always receive the market average.
Some of the most popular indexes are the S&P 500 and the Total US Stock Market.
5. Buy and hold
This is when you buy stocks and hold them for a long time.
This is a longer term approach to investing that doesn’t involve itself with short term market movements.
Warren Buffett says this is one of the best strategies for individual investors.
This is when you buy stocks and hold them for a long time.
This is a longer term approach to investing that doesn’t involve itself with short term market movements.
Warren Buffett says this is one of the best strategies for individual investors.
6. Small cap
Small cap investing focuses on companies valued between $300 million to $2 billion.
Small companies have a higher potential of experiencing high rates of growth.
But this also comes with greater volatility.
This is best for investors with high risk tolerances.
Small cap investing focuses on companies valued between $300 million to $2 billion.
Small companies have a higher potential of experiencing high rates of growth.
But this also comes with greater volatility.
This is best for investors with high risk tolerances.
7. ESG
“Environmental, Social, and Governance”
This type of investing lets you invest based on non-financial factors like:
- Employee treatment
- Environmental impact
- Company management
ESG investing allows you to influence positive changes in society through investing.
“Environmental, Social, and Governance”
This type of investing lets you invest based on non-financial factors like:
- Employee treatment
- Environmental impact
- Company management
ESG investing allows you to influence positive changes in society through investing.
8. Active/Passive
Mixing active and passive strategies means you pick individual stocks and invest in indexes.
A good rule of thumb is to invest 70% of your portfolio in indexes and 30% in individual companies.
This way your entire portfolio isn’t exposed to individual risk.
Mixing active and passive strategies means you pick individual stocks and invest in indexes.
A good rule of thumb is to invest 70% of your portfolio in indexes and 30% in individual companies.
This way your entire portfolio isn’t exposed to individual risk.
9. Options
Options are agreements to buy/sell groups of stocks for a specific price on a specific date.
This complex investing strategy is best suited for experienced investors with high risk tolerances.
But when done correctly, it can create additional passive income.
Options are agreements to buy/sell groups of stocks for a specific price on a specific date.
This complex investing strategy is best suited for experienced investors with high risk tolerances.
But when done correctly, it can create additional passive income.
10. Day trading
This is when you buy/sell stocks within the same day to profit from price changes.
To day trade successfully, you must understand:
- Your risk tolerance
- Stock market basics
- Capital requirements
Otherwise you WILL lose money.
This is when you buy/sell stocks within the same day to profit from price changes.
To day trade successfully, you must understand:
- Your risk tolerance
- Stock market basics
- Capital requirements
Otherwise you WILL lose money.
11. Momentum
Momentum investors believe stocks in motion will stay in motion whether they’re going up or down.
This is determined by price patterns and technical analysis.
Which means to be a successful momentum investor, you must keep up with the market at all times.
Momentum investors believe stocks in motion will stay in motion whether they’re going up or down.
This is determined by price patterns and technical analysis.
Which means to be a successful momentum investor, you must keep up with the market at all times.
12. Factor
Factor investing is based on stocks meeting a list of criteria.
Common factors are:
- Debt
- Size
- Volatility
- Earnings
The goal is to find stocks that exhibit characteristics of good investments.
The hope is the qualifying stocks will also be good investments.
Factor investing is based on stocks meeting a list of criteria.
Common factors are:
- Debt
- Size
- Volatility
- Earnings
The goal is to find stocks that exhibit characteristics of good investments.
The hope is the qualifying stocks will also be good investments.
Thank you for reading!
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2. RT the first tweet so others see it
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