As a renowned businessman and investor, Haim Toledano feels obliged to share some of the most insightful investing tips with his fellow investors. This is what he has to say about the most important tips in the trade.
- Knowing when to retreat
If you could read the future, it would be simple to invest and make profit, but then everyone would be doing it and you would have no benefit over them. “People and companies that want you to invest will always make their reasons for doing so sound plausible”, explains Haim Toledano. “however, doing your own research is highly necessary, since greed is what causes most people to lose money”. If the company is bragging that every investor is going to get a huge return in just a few short months, it’s likely that there are some lies along the line. If you are doing well and have already made a pretty penny from your investments but hear through the grapevine that problems are set to arise it might be time to take your earnings and run. “Not being overly greedy can be what saves you from losing a fortune”, Toledano points out. “Get rich quick schemes are seldom genuine otherwise there would be no poverty and such a small amount of people with a high percentage of capital”. Start off slow, invest smaller amounts, and don’t put your eggs all in one basket for a better chance of being successful. If you are in profit don’t hang around too long.
- Stop panicking about the taxman
No one looks forward to paying taxes, and it has been highly publicized that there have been many people with more than enough money to contribute that avoid paying them like the plague. Making short term gains is something that people tend to worry about stock being held longer term. Buying and holding often gives you greater capital than buying and selling quickly. Selling at a loss stops you from having to pay taxes, however this also means that you have lost some of your own money to do so. Rather than worrying about the tax man’s cut, instead remember that gains are better in the long term; so stop worrying about losing out to the tax man and instead look at the bigger picture of how much you could gain no matter how long you hold the revenue.
- Don’t invest in damaged companies
Although it can be tempting to buy up solid stocks and shares at a reduced price it might not work in your favor. If a key part is missing and you haven’t got any type of guarantee or warranty you could be stuck with a lot of stock that you just can’t shift. There’s nothing wrong with buying damaged stocks but investing in a damaged company could land you at a severe disadvantage. If the stocks are being sold due to an issue that can be easily solved, it may be worth investing; however, if the company’s brand and image are damaged, the chances are greater that great bargain you landed could become a chain around your neck that drags you down with it. Panic sales can go either way so don’t forget to do your homework. If the deal seems too good to be true find out why before parting with your cash. Get yourself ready by creating a list of companies you have researched beforehand so that if a mass sale comes about you are already well informed so that you can strike while the iron is hot or avoid like the plague.