When Do You Know You Made the Right Investment?

Being in the world of business and finance always keeps you under a constant risk of losing what you invested. No one can ever escape this risk completely but it can be squeezed to a minimal value by following a set of instructions which enables you to judge all the offers that the market presents and then make a wise decision about investing in a particular stock.

Many people who are new to this field fantasize the business world to be some sort of money generating fantasy and this drives them into always being in a rush to make money but one thing must be kept in mind that this is certainly NOT how things work here. If you aim for long term results then think clearly, invest smartly and try to be the turtle and never the rabbit!
Listed as follows are some of the key points which will let you analyze an investment proposal and will enable you to judge if it is actually worth it!

Higher Return Rate

Before making an investment you should always consider its most probable return rates. It should be above average even in small investments. The one which outperforms all the alternatives of investments is more likely to yield higher return rates so it is advisable to go for such an investment.

Safety

You should always be very careful as to where you are investing. Being careful is the primary precautionary step that one must take in this business. Never invest in something which you do not understand or which has more chances to result in the loss than in profit. It is not that you should get to a conservative extreme and not take risks at all but even if you decide into taking a risk, use your brains well before taking your chance!

It Should Be Liquid

A good investment is the one, which possesses the quality of being redeemed for cash whenever you want to pull out without any fear of loss or penalty. If you come across such an investment, it is guaranteed to be a nice catch as it has very slim chances of ending with the loss.

No income taxes

Ty to make an investment, which does not have any taxes, due on its growth. In this way, you would get to keep all the profits all to yourself and will end up making more money.

Passivity

The investments of the sort in which you do not require to be a specialist in some field to manage it are the best of all. Good investments do not demand a great knowledge of a particular subject for its active management; they rather allow you to put your money in and then let the business decide the fate of it.

Having said all this, you must know that one can never find perfection. So if you go out looking for investments which meet all of the 5 criteria mentioned above, then it is highly unlikely that you’d come across one. So just, go with the one which agrees with this criteria to the maximum extent and then takes a leap of faith!