Don’t Put All Your Eggs In One Basket
Diversification is the key to success. When it comes to investing your hard-earned funds I always remind myself of the famous proverb “Don’t put all your eggs in the same basket.” Diversification of investments allows us to spread the risks associated with various investments.
Many people are reluctant to invest because they’re worried about risk. The fear of losing everything is misplaced, if you’re sensible about where you choose to put your ‘eggs’. Taking my own example, I am very passionate about film making and aspired to be one of the best Film Producers of India but I also chose to invest in real estate simultaneously. Film production and real estate are both interesting ventures for me. I decided to weigh the pros and cons and made some creative calculations when it came to investing in films. Real estate has its own charm. I have successfully completed projects related to residential and commercial properties, many of which have won accolades for its high quality and timely delivery. Although it takes a long period of time to make firm decisions, however on the brighter side diversifying your money can help you earn good results and gain valuable experience in the end. Investing all your money in a single venture is never a good option as it is equivalent to taking a huge amount of risk in one go. If that venture fails, you can lose all your money.
The best way to lower your risk without sacrificing the potential for higher returns is to spread your money wisely. Each additional investment type, you select acts like a separate basket. Always be prudent and make clever decisions when it comes to investing your money. Why choose one risk level, when you can pick several? ‘Diversification’ is the best strategy for most investors.
Don’t limit your potentials or be restricted to just one area, explore and experiment as much as you can. Avoid being biased to one area – aim for multiple avenues. Variety is the spice of life. Always have a backup plan if one plan fails you must have other options too.