Being an investor can feel like you’re a monkey swinging through the jungle. You might look like you’re soaring through the air with aplomb as you wing from branch to branch. But your position is always just a little tenuous. You may assume that the next branch you’re swinging towards will give you the purchase you need to stay safe. But the branch could snap and send you hurtling downwards, and by the time you hear that fatal crack of splitting timber it could be too late. Still, like the monkey, the smart investor never flies blind. They have a practiced eye and know all the signs to look for to assure themselves that an investment is stable enough to support them, even in the breakneck pace of the active market.
Whether you’re trading in stocks or shares, bonds or bitcoins, Forex or property uncertainty comes with the territory. And what looks like the safest of bets can turn bad at a moment’s notice. Here we’ll look at some signs that an investment should be dropped and fast before you’re left out of pocket…
It’s costing you more money than you can hope to make
The money pit is the bane of all property investors. Whether you’ve bought an apartment to lease or a trailer park, you can quickly find that the various costs of repairs, maintenance, mortgaging and general management exceed what you could hope to make in rental income. Nobody likes admitting to themselves that they’ve bought a money pit but the sooner they get their property on the market or visit Mobile Home Park Instant Offer the less the monetary and opportunity cost. It’s better to liquify your assets and live to fight another day than to cling to a dud in the hopes that the market will create the conditions to improve your lot.
Everyone is buying it
All nascent investors live in the hope of getting their first hot tip. But as the seasoned investor will tell them, hot tips don’t stay hot for very long. If a tip has made its way down the grapevine to you, there’s a good chance that it’s fallen on a lot of other ears, too. And if everyone’s buying… well, there goes your value. Ditch these commodities quickly or avoid them altogether.
Your financial advisor is likely to make a hefty commission
A financial advisor or stockbroker is there to help you to make the right investments for your strategy and financial goals. However, they need to earn a crust too. If they don’t command a fee upfront, they will almost certainly earn a commission on the investment products that they recommend to you. And that could compromise the impartiality (and the legitimacy) of their recommendations. If you find out that your financial advisor has made a lot of money on a product, unload it as fast as you can. It could do you more harm than good.
It sounds too good to be true
Finally, as in most things, if an investment seems too good to be true… that’s because it probably is. If you’ve recently bought something that’s set your spider-sense tingling, you might want to look into the person who sold it to you. Look them up on the EDGAR database or contact your state securities regulator to make sure they’re legit. If you feel you’ve been strong armed into something or are worried that an investment is too good to be true, the best thing to do may be to drop it quickly and reassess.