Be deliberate - Setting measurable investment goals gives you clarity and direction and prevents you from falling into common investment traps like chasing unrealistic market returns or being overly influenced by transitory factors like product fads or short term performance.
Before you invest a single dollar, ask yourself your key reasons for growing your wealth – is it to fund retirement? A house deposit? By establishing your goals, you can get a better idea of your time horizon and tolerance for risks – two important factors that contribute to developing the right asset allocation.
More is not always better - Without a plan, investors often focus on each investment holding rather than the portfolio as a whole. Diversification is not necessarily about owning more securities, but rather the right mix of securities.
Owning a diversified portfolio with exposure to different markets allows you to participate in stronger performing areas while also mitigating the impact of weaker areas.
Focus on what you can control - Two of the most important qualities to have when it comes to investing are to maintain both discipline and perspective even when conditions get tough. These two qualities are instrumental in helping investors remain committed to their long-term investment plan through periods of market uncertainty. While deciding on the right asset allocation is one of the cornerstones for successful investing, it only works if the allocation is adhered to over time and through varying market environments.