7 KEY RESOLUTIONS FOR INVESTORS
1. KEEP INVESTMENT PAPERS UPDATED
· Check if all the papers relating to your investments are in order and updated in all respects.
· This is critical since a loss of an important paper can lead to a lot of inconvenience.
· Make sure to read all the papers, documents and letters sent to you from your mutual fund, broker, insurer and other companies related to your investments.
· Evolve as an informed investor by seeking help from your investment advisor if you don’t understand something.
· Get organized once to avoid remembering everything, or loosing track of things.
2. DON’T INVEST ON MARKET TRENDS
· Don’t look at the market trend, movements, mutual fund NAVs or stock prices everyday.
· Such acts can make you very concerned about your money.
· As a long-term investor, you have time on your side.
· Your investment horizon can even out the daily volatilities over the years.
3. KEEP PORTFOLIO OBJECTIVES AND GOAL AMOUNTS IN MIND
· Consult your financial advisor to confirm if your portfolio and its objectives are fully in sync.
· Check if your portfolio is performing according to your long-term financial goals.
· This will keep you from going off track in realizing your financial dreams.
· Remember to keep inflation in mind.
· Remember, your goals have got to be S.M.A.R.T - Specific, Measurable, Adjustable, Realistic, Time bound.
4. NEVER INVEST ON TIPS
· Investing your hard-earned money on tips and rumours is akin to gambling.
· Invest only in good companies with a sound track record.
· If your risk profile allows you to invest in the stock market directly, your financial advisor should be able to guide you to the right stocks to put your money in.
· Try to maximize your tax savings every year, to invest them for your retirement needs and other financial goals.
· If self-help does not work for you, immediately hire a financial planner to plan your finances to bring clarity, benefits, and the feeling of control over your financial life.
5. MAINTAIN A RECORD
· This is different from keeping your investment related documents in order.
· Maintain a notebook or diary for writing the rationale for investing in the particular asset, be it mutual funds, stocks, bonds, gold or any other asset class.
· It should also contain the expected rates of return on the investments that should help you achieve your financial goals.
· Also, write down the information that you believe is important to your investment decisions.
· Flip through its pages once in a while to evolve as an alert investor.
6. KEEP YOUR INVESTMENT PLAN SIMPLE
· Invest in those asset classes that you understand, at least a little even if not fully.
· Avoid exotic products that promise far greater returns, but with greater hidden risks.
· Remember the adage about investments: ‘Be simple. Be stupid’.
· Such an approach will ensure that you will not be left to count your losses.
· Reduce your unnecessary expenses to increase your savings every month.
7. FIGHT FOR YOUR RIGHTS
· Be sure to address your problems as an investor without much delay.
· The problems could be from banks, brokers, mutual funds or companies that you have invested in, or someone else.
· Remember to approach the right forum to resolve them.
· If not resolved on time, or to your satisfaction, escalate the problem to the next higher level.
'People who say it cannot be done are interrupting those who are doing it.'