5 Tips to Safe Investment in Unstable Market

Global economy has undergone massive disturbance. From subprime mortgage crisis in 2007, impacting not only major monetary institutions in USA. The real impact was on the Composite Stock Price Index on September 9th 2008 falling 42% to 1.641, from 2.830 in early January 2008.

1. Investing Based on the Risk ProfileThere are 3 types of investors: agressive, moderate, conservative. Agressive investors enjoy agressive portfolio development with lower concern on short/mid market fluctuation. This type of investor is suitable in stock investment.Moderate investors put more concern to stable portfolio development and for them, most of the investment can be put in stable instrument with the remaining in stock market.The last is conservative investor. This type of investor put main concern on regular investment return, without market fluctuation. This type should invest their fund in fixed-income instruments. By knowing the risk profile, you can select your suitable investment.

2. Diversifying InvestmentThere is an old saying “Dont put all your eggs in one basket.” Besides knowing the risk, every investor should diversify their investment. If you are an aggressive investor you should spread your investment on many stocks. The easiest way is by purchasing unit-link products, where your investment manager automatically invest your fund in many stocks in various sectors to divide the risk and prevent significant loss in case of unrest in one or more of the sectors.

3. Currency-cost Averaging InvestmentIn unstable market, this type of investment strategy is applicable. By this term, you can take advantage on the drop by still taking investment unit in lower price. Therefore, when the market is stable again, you can gain additional profit.

4. Purchase Investment only fom Reliable Source With various investment products available today, investors must be able to determine the best managers to handle their investment proffesionally

5. Select Long Term InvestmentShort term investments, mainly in stock exchange, can experience sudden drop. However, the long term ones are tend to move within the economic growth and inflation. The investment will grow along with a country economy.

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