share market tips, are you a first time investor follow this strategy to earn more profit on diwali – are you a first time investor follow this strategy to earn more profit on diwali

Mumbai: First-time investors in the equity market through equity-oriented mutual funds are often intimidated by the high volatility of the market. For this reason their participation in the equity market is low. But this is more than a practical challenge for some reason, and the problem is also easy to solve. But for this one has to focus on market risk and expected return. A few things should be kept in mind before investing for the first time, so that they can get more returns from the market.

Investors are risk averse
Talking about our country, many investors have seen investing in a certain way for the first time since childhood. Because of this, they think of investing in the same way. Traditional investment or traditional investment with fixed interest means that the returns here are very predictable from year to year and consequently the risk involved in this type of investment product is negligible. Many investors don’t traditionally think about inflation-adjusted returns or real returns. Because of this, although the rate of return is low, the risk in these options is also very low. Therefore, many first-time investors view investing in market-linked options as a fixed income investment and do not fully understand the relationship between expected returns and the risks involved in any investment.

Understand the importance of compounding
Currently, there are many traditional investors who are not used to investing money anywhere other than fixed income options. So they don’t fully understand the benefits of long-term compounding. After hearing about negative returns and increasing market volatility, they stay away from market related investment options. For such investors, two good options have emerged in the mutual fund sector. The first is the Balanced Advantage fund category, which seeks to overcome this market volatility by virtue of its product design. Another option is to focus on goal-based investing and asset allocation.

A buy and hold strategy is better
Investors should not be confused about investing in the market and should not fall into the trap of greed. If an investor follows a buy and hold strategy, you can get good returns in the long term.