The word “investment” comes from the English word – to invest, and its roots are investment, which means planting. As with the initial understanding of the concept of agriculture, of course, if a farmer grows crops, he hopes that the seeds he grows can grow and bear good fruit. Therefore, farmers can benefit from this crop. The same goes for finances. If an investor invests a certain amount of funds in a particular business, then of course the investor expects the fund will grow and make a profit. Investing is one way to develop the money or assets you currently have. In short, you intend to raise more funds to achieve a specific goal than a profit in the future.
However, current investment activities must be more planned and conducted appropriately because they take into account the infectious virus that now attacks humans, namely the corona virus. This hinders investment activities and causes the community to reconsider these activities. The COVID-19 outbreak has seriously affected all countries in the world. The impact is not only in one area, but also in all existing activities. During the COVID-19 outbreak, one aspect of concern was investment.
COVID-19 has not only had an impact on public health, but also had a major impact on economic sectors. Market uncertainty that continues to indicate weakness is causing anxiety among investors and the public. Therefore, many investors are withdrawing their investment tools. Therefore, investment strategies need to be reconsidered. The smartest technique for investing is to understand the goals first, then apply the most suitable type or tool to achieve those goals. It is important to be able to predict the chaos that may arise when the market fluctuates, such as the current COVID-19 pandemic. The decision whether to sell or withhold or transfer the tools owned should refer to the initial purpose identified.
If you’re still considering, you haven’t decided whether to save or invest. You should choose to save first. Why is that so? If at any time you experience a lack of cash, you will need these savings to meet your needs. However, if you have no savings, but only investments, it is unthinkable when the value of the investment one day drops, and you need cash. Therefore, it’s a good idea if you have savings before investing.
Before you start investing, you must understand the needs and characteristics of your investment. The financial goals of each investor vary greatly. Therefore, the first step to take is to understand the risks you may face as an investor. All investments, whether in stocks, bonds, bank deposits, or other forms of securities, are risky. The value of stocks and other securities may rise or fall, depending on the performance of the company, industry, capital/money market conditions, and country/region. As a basic principle of investment, risk remains, but can be minimized by professional handling of funds.
The simplest investment advice is bought when the price is low and sell when the price is high. However, since low prices and high prices are qualitative, it is difficult for us to describe which prices are considered cheap and which are expensive. Therefore, we use numbers to determine the value of an investment. For example, in mutual fund investments, unit prices. The price of this unit or Net Asset Value changes every day, and what we get today is yesterday’s unit price, depending on the company’s policy.
In the world of stock investing, you can get extraordinarily rich by passively investing in reputable companies. We should choose the shares of companies that have been established hundreds of years from now. When buying shares, we should consider buying a company or enterprise, not just buying a piece of paper whose price fluctuates the next day. We must choose the best stocks, such as when we want to choose a life partner.
The public must understand that businesses in this investment field have risks and must be wary from the beginning, so that every return that investors want is always proportional to the risk. If an investor is willing to accept a significant risk (big risk) then he will get a high return (high return), but for investors who do not want to accept risk then the rate of return is very low (low return).
The amount of the reward is also related to the amount of investment. If one invests a lot of money, the profit will be greater. There are several strategies before you decide to invest. In addition, due to the current situation of the COVID-19 pandemic, many workers have been repatriated. To make a living or even profit, not a few people commit crimes for one reason or another. For investment participants or investors, it is important to maintain, track and analyze the development of COVID-19.
There are several steps that investors must take, especially for beginners before starting to do investment activities.
First, set financial goals. It aims to choose the right type of investment and adjust it to its risk profile. At the time of the pandemic, it is very suitable to invest with low security properties, especially as investors, especially beginners.
Second, if it is necessary to pay fees such as tuition soon, the types of short-term and low-risk capital allocations are money market funds and government bonds. Government bonds are considered safe because the guarantor is the government. Funds in the form of government bonds will be used to finance various projects that benefit the community, such as health and education infrastructure.
In addition to government bonds, novice investors can also try money market mutual funds. This type of mutual fund has the lowest level of risk. Money market mutual funds are not very risky because they are placed on products with a shorter period. Investors only need to go to the nearest bank unit that already has permission to sell mutual funds. As an option, you can also choose an automated debit service that regularly deducts your savings to allocate to mutual funds.
Whatever your investment choices, it’s important to measure your profile as an investor in relation to investment risk. Understand the investment formula – low return low risk, moderate return moderate risk and high return high risk. Good luck with the investment products available.
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