Top 5 Qualities that make you a better investor

Investors qualities
Top 5 Qualities that make you a better investor

We have already discussed in our previous blog posts the importance of having a strategy and the right tools that allow you to plan and make the best investment decisions, according to your budget and investment policy. If you have missed any of these articles, you can go back and check them out in our blog section.

By keeping the previous blogs in my mind, I thought of starting to think, identify and analyze some of the best qualities that you must have if you are an investor or you are about to start investing in the bond market. And in just a few words, this is what I was able to compile.

Investors qualities

Investment is nothing but a game of risk and return. In this game, an average investor uses most of his money and invests the rest, and other investors invest most of the money and use the rest. But it all depends on your budget, and your policy mandates, like the most common ones: liquidity, safety and yield. So everybody needs their own strategy, and this is when the treasury managers have to think through the short and long term money necessities for their entities.

In this game of investments, some have made millions and many have lost millions as well. So, what makes a good investor different from the rest?

Here are some of the qualities/traits that you should seek after to become a good investor.

  1. 1. Goal: Always have a clear goal. It is very important for you to plan your goal and have a right strategy before you start any investment purchase. The Bond market is always volatile with uncertain market conditions, and by having a goal accompanied by an action plan within a defined period, this makes the possibility of higher returns and lesser risk, even better. In fact, top investors always focus on goals for long-term and short-term investments, depending on their needs. Think of doing a cash-flow analysis to determine those needs, and being able to set a goal.
  1. 2. Knowledge: Apart from the right plan and strategy, you must also have a basic knowledge & understanding on the type of security that you want to purchase, adding to that it is always good to know the historical performance of any particular security, which translates into be a better-informed investor… and I know a Company that goes by the name of PFITR who can help you with that part, throwing in some technological solutions to help out too!
  2. 3. Right decisions: Easy right? To be a good investor, you should know the correct time of investment and keep an eye on the current market scenario. Also, it is never a good idea to put all your assets and all your risks in a single asset class or investment, so it is always advisable to diversify the risks within your bond investments by creating a portfolio of several types of bonds (Munis, CD’s, Corporate bonds, redeemable bonds, callable bonds, etc.). This trait again, could be achieved by having access to all of the bond market data, so you may better understand the trends, available financial instruments and transparent information to make better investment decisions.
  3. 4. Patience: Patience is the key thing, in fact the finest quality of a good investor. Once you have laid out a good plan, according to your necessities (investment policy, stakeholder’s requirements, legal and regulatory compliances) you have gone through the necessary and transparent data required to make a good investment, so now you should not get excited or demotivated with sudden ups and downs in the market, you should stick to your plan and enjoy the greater benefits at maturity. A good bond investor is persistent about sticking to the plans and usually do not get into the buy and sell trends a whole lot.
  4. 5. Risk: Good investors always analyze the risks and yield that can come up with their fixed income investments. The yield might be very easy to figure out but most have problems identifying all of the risks that can expose their investments. If only all of the institutional investors that got affected by the increasing interest rate risk after the US Presidential election, there would not have already been a 3 Trillion Dollars lose.

 

All of these qualities or traits are a sign of good investor, a responsible fiduciary that has the expertise or consults an expert like the PFITR team, to look for the essential knowledge and confides in the latest technological solutions to base their investment decisions on.

No one can master this art in a day or two, but yes, we can all be better investors if we develop these qualities in ourselves, by acquiring the right help and solutions. And then, even aspire to become one of the best investors by summing up all the qualities required with this top three characteristics:

  1. 1. Be well informed.
  2. 2. Know your risk.
  3. 3. Be disciplined.

PFITR is the solution that wants to help you with those top three characteristics.

At first, you will try to imbibe the initial five qualities we described, and that is how you should begin, to master the art of becoming the best bond investor you can be. However, if you are not sure and stuck with anything at any point of time, then it is always good to take the help of professionals. And these professionals, like the PFITR team, will equip and coach you to be: well informed, know your risk and be discipline with your investments. Then you will be able to become the best investor you can be, because PFITR will not just to provide you with all the necessary, current, unbiased market data through our online software solution, but we will also coach & guide you on how to make the best investment decisions, with the available data such as the risks and the necessary discipline to stick to the investment decisions you already made, no matter what unexpected trends happen on the bond market.

We believe that with the right use of knowledge and technology, like our Bond Price Validation tool, anyone can improve the returns of fixed income investments. And the best part is that PFITR has made it its mission: improve and bring transparency to the bond market.

You can call them at 1-800-921-1992 to get a firsthand experience on PFITRs guidance. Do not hesitate to ask for even a minor issue which is bothering you, because we are here to empower bond investors to be better stewards of their portfolio with the right investment tools and the right guidance.

To know more about PFITR, please visit https://pfitr.com/bpv-tool/

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