Your investment options
YOU'VE got a good job, savings in the bank and a bit of spare money - what are you going to do with it?
Investing is always an option.
There is a lot more to investing than just buying shares when they are down and selling them when they are high.
If you are considering investment, the first thing you should do is consult a financial adviser.
This would be to work out a risk profile that suited your investment style, Ord Minnett Mackay branch manager and stockbroker Brett Smith said.
"People from different age groups have different risk profiles," Mr Smith said.
"You need to find out what your risk profile is."
For example, to the retiree it would be more important that their capital was secure than for someone who's starting out in the workforce.
"They might want more risk... because they have more work ahead of them," he said.
And it's broad and varied.
"There are people in their 30s that don't like risk at all... and there are people in their 30s that want risk," Mr Smith said.
"It really is a personality profile as much as anything else."
The key to investing well is deciding how you want to invest, "then following through to the outcome", he said.
"If you're someone who is looking for risk and the market hits a rough patch, you've got to be expecting that."
Quite simply - the success of your investing depends on what you're expecting, he said.
"If you're not looking for risk, stay away from volatile investments," Mr Smith said.
Right now Mr Smith said we were in a very risk-averse market.
"Most people are sitting on their hands and watching what's happening ... a little bit concerned that world markets are very volatile," he said.
In such a market most companies are trading at a discount to what their book valuation might be, he said.
A far cry from 2007's booming market, Mr Smith said, when people were paying a premium for what investments were worth.
DO'S AND DON'TS
Do's for investing
- Make sure you have worked out your personal financial position with your adviser; talk clearly about risk and your goals.
- Use a financial adviser. It may cost a little more at the start but it will pay for itself many times over in the long term.
- Invest in products that you understand and can see an outcome that makes sense.
Don'ts for investing
- Invest for tax benefits only, especially when the underlying product seems very complex and difficult to understand.
- Focus on one sector or asset class - diversify your money.
- Rush into investing, things that seem too good to be true and require immediate attention usually are too good to be true.