Don"t Invest All Your Money at Once
Investing is an uncertain business and you should approach it as such.
Nobody can tell you when the best time to invest your money is.
You have to design your investment strategy to take that into consideration.
Most financial experts will tell you to diversify your investments.
Buy some bonds, some stocks in different companies and maybe keep some of your investment in cash.
That way you don't risk all your money in one specific investment.
The same goes for the time-frame you invest your money in.
If you invest all of it at once, you risk buying right at the top of the market.
If, for example, you had bought stocks at the end of 2007, you would be in for a big loss of your investment.
It would take you many years to recoup that loss.
To reduce this risk, you should make your investments gradually.
If you have one large sum of money to invest, start by putting it into a savings account or some short-term bonds.
Then, gradually move your money from the savings account and invest the money in stocks and bonds with a longer duration.
If you have an amount of cash to invest every month, it is easy.
Since you save every month, you will already be investing your savings over a longer time-frame.
The advantage of this approach is that you don't risk buying at the top of the market at very high prices.
Of course, you won't have the windfall of investing all your money at the bottom either.
You will buy some at low prices, some at average prices and some at high prices.
Since part-time investors have no chance of predicting when the market will go up and when it will go down, the best we can aim at is to get an average result.
With this approach you get that average result.
One thing that could make it worth your while not to follow this tactic is if you just have a small amount to invest.
If you invest a small amount every month the expenses of investing might get too big.
Or it will not be possible to invest it at all because it is too small an amount.
In that case you would have to invest it in larger chunks.
In that case, I would recommend you invest in a more conservative portfolio, though.
Nobody can tell you when the best time to invest your money is.
You have to design your investment strategy to take that into consideration.
Most financial experts will tell you to diversify your investments.
Buy some bonds, some stocks in different companies and maybe keep some of your investment in cash.
That way you don't risk all your money in one specific investment.
The same goes for the time-frame you invest your money in.
If you invest all of it at once, you risk buying right at the top of the market.
If, for example, you had bought stocks at the end of 2007, you would be in for a big loss of your investment.
It would take you many years to recoup that loss.
To reduce this risk, you should make your investments gradually.
If you have one large sum of money to invest, start by putting it into a savings account or some short-term bonds.
Then, gradually move your money from the savings account and invest the money in stocks and bonds with a longer duration.
If you have an amount of cash to invest every month, it is easy.
Since you save every month, you will already be investing your savings over a longer time-frame.
The advantage of this approach is that you don't risk buying at the top of the market at very high prices.
Of course, you won't have the windfall of investing all your money at the bottom either.
You will buy some at low prices, some at average prices and some at high prices.
Since part-time investors have no chance of predicting when the market will go up and when it will go down, the best we can aim at is to get an average result.
With this approach you get that average result.
One thing that could make it worth your while not to follow this tactic is if you just have a small amount to invest.
If you invest a small amount every month the expenses of investing might get too big.
Or it will not be possible to invest it at all because it is too small an amount.
In that case you would have to invest it in larger chunks.
In that case, I would recommend you invest in a more conservative portfolio, though.
Source...