Investment

: Factors to Consider

The simulation game provided 100000 dollars for the investor to useas starting capital. Shares and stock in which he could invest withwere limited to Toronto exchanges as others are at times too volatilein nature. He invested in the TMX group limited shares, The SuncorEnergy Inc., Tech Resources Limited, Toronto Dominion Bank, PotashCorporation Of Saskatchewan and a few more others. On the short stockportfolio, he only invested in the BlackBerry limited company stocks.Only four companies has a rise in their rated thus bringing in someprofit. The others fell and this led to the loss on the investedcapital. Studying the company’s histories would have played a bigrole before investing in them and this led the learning of a lot oflessons in investment. The value of investment went down $98,907 andthis indicates a loss in the rate of return.

Decisions made during investment are very crucial as they helpdetermine what returns an investor will have. By using themicroeconomics perspective, investment decisions account forsignificant changes in the gross domestic product. These decisionsare also very crucial for the growth of companies as they help reducethe unit cost where needed. decisions are subjective tomany influences, and thus an investor should have a vast knowledge ofthe market to enable him, or her make right choices. All investorsshould take into account risks like market uncertainty, and also whatto invest in as market fluctuations are very common currently. Manystudies have been done so as to provide information for investors toconsider so as to enable wise decisions.it has led to the creation ofwebsites such as the Investopedia which offers Investopedia stocksimulation.

By providing virtual money as the starting capital for investment, aperson will be able to gauge his or her knowledge in investment. Aperson will either undergo a profit or loss according to how hechooses on what to invest on and also he or she will acquireinformation on how to study the market and the do’s and don’ts ininvestment. After undergoing a loss in the simulation game, here aresome lessons learnt in investment. Due to each person havingdifferent goals and priorities, individual investment varies amongpeople. Before investing a person should first formulate a strategyon how to do it. Writing down of the investment goals works as a setup for successful investment. When new to investing, it’s importantto either find a financial planner or study the field of investmentto avoid doing it blindly. The presence of a person who knows themarkets trends, strategies applicable in investment can help create agood portfolio.

There are many considerations an investor should make, and the mostimportant are after what period an investor wants to get the investedmoney back. It means that investments can either be long-term orshort-term. When undertaking a short-term investment a person shouldcheck on the risk factors and the security of the invested money. Butin long-term investments, an investor can be more aggressive and thusundertake more risky investments. An investor should also considerthe capital available so as to carry out an investment. This helpsdesign a diverse portfolio and thus helps in reducing risks. Limitedcapital does not allow the creation of an excellent collection ofindividual stocks, but when the capital is plenty, investment inindividual stocks and other items is better.

A good investor should be a risk-taker. The most vital factor inselecting the best investment options is the ability of the investorto be a risk taker. At times, financial markets misbehave, and thus agood investor should stick to the specified investment plan. A personwho is not afraid of risks can invest even in the volatile stock`ssector as the uncertain the investment is, the higher the returns. Onthe other hand, nervous people who flinch due to the slightestmovement in the financial markets should stick to non-riskyinvestments to avoid losses. As a conclusion it is evident investmentrequires a lot of information so as to provide good returns. All thefactors of investment stated above influence investment decisions indifferent ways. Thus factors have various applications such ashedging method to control the level of risk, acquire knowledge of themarket and much more.