Investing is never a piece of cake. Whether you’re looking into investing in a new business opportunity, a private company or an up-and-coming entrepreneur, risk is always present and the effects of your investment choices will inevitably be long-term. Before you take any big leaps, here are some small-scale steps you can make.
Evaluate your personal finances
Sit down and take an honest look at your entire financial situation, especially if this is your first ever investment. Drawing up a personal financial roadmap will help you figure out your goals and risk tolerance levels, as well as secure greater financial security. If you find this tough to do on your own, you can always enlist the assistance of a financial professional.
Assess your comfort zone
As Tom Cruise knows all too well, investing is always a risky business. Some, if not all, of your money can be lost in the process. So evaluate your comfort zone and understand to what extent you want to go to achieve a great investment return. Investing solely in cash investments will only make sense if you have short-term financial goals. If you want to be in it for the long haul, and you want to make as much money as possible, you may need to risk investing in various asset categories such as stocks or bonds.
Talk to customers
Speak to at least three customers of the company or business you’re aiming to invest in. Learn first-hand what they like about the product or service they are getting, how they compare it to available alternatives, and whether they would recommend it to others. Take into consideration both those who are loyal and passive to the product or service being offered, and keep an eye out for any openly critical customers who could be hindering business growth.
Research, research and research some more
A prepared person is half armed, or so the saying says. That might not be the best translation from Maltese to English, but it is definitely very true. Study the subject of your investment carefully, make use of its services and be open to learning more about the relevant industry. The better you understand the business that you’re planning to invest money in, the more confident you will feel in your decision.
Ask experts for advice
Speaking to a professional investor or an investment banker can do wonders. Their experience in financial strategy can come in extremely handy when you’re still getting your head around whatever you want to invest in. A few hours of voicing your concerns to this kind of guiding professional will answer questions you probably didn’t even know you had. You might also want to consult a lawyer to spot any legally invalid aspects to your investment plan.
Ready to take on the challenge? There are 29 Investment Service Providers listed on yellow.com.mt who can guide you through your next business investment.
There’s something for everyone, visit yellow.com.mt