If you are in your 30s to 40s, you have some of the advantages that
those in their 20s and 50s do not have. Here are some we list out for
you.
- More Capital
After working for years, there is more capital for people in 30s to
40s to invest in stock market. This is a great advantage as it provides
enough liquidity to perform different investing strategy. With constant
monthly income, a portion can be allocated to buy potential growing
stock and good dividend stock. When price moves up, you can accumulate
slowly until a level where you think it is too pricey. When price goes
down, you can average down by collecting it slowly to lower your entry
price. This is somehow difficult to perform for people in 20s as limited
capital may draw their emotion and fear more towards cutting lose when
they see a stock price declining.
- Better Network
People in 30s to 40s have better network when well managed. This is
crucial source for information. Imagine you have close friends holding a
manager position in a company that you are interested to invest or
doing business with a company you are interested to invest, you can get
firsthand information from them. The information mentioned here is not
those related to the forbidden ‘insider trading’, but those basic info
like what is the company’s culture, their recent sales activities,
sector trend and so on. Their feedbacks are really useful in stock
selection. Say if you see a company’s recent financial result is good,
but your friend in the company tells you that their company has just
closed down a few branches. This gives you clue on the near future
prospect of that particular company.
- Understand Your Need
There is a saying by Confucius which goes ‘At Thirty, I Stood Firm’.
People at their 30s to 40s are more sedate. They have set their life
goal and started to build their confidence in the path they choose. This
steadiness can help avoid many undesired trading acts in stock market.
Understanding what you need is essential in maintaining a healthy
portfolio. At the age of 30s to 40s, you already have an idea about your
commitment towards your career, family, your own self-realization and
many more. With proper financial planning knowledge, you know exactly
where to put your wealth.
- Steadier During Volatile Market
At the age of 30s to 40s, you know how to position yourself in stock
market. As you can’t monitor and perform frequent daily trade, you are
more focus on those good companies that actually perform. Your exposure
to highly volatile stock is lesser. To certain extent, you understand
the value of a company you invest. So even when KLCI index decline
aggressively, you are confidence to accumulate more of a particular
stock. Your other advantages, like more capital and better network, also
allow you to perform certain simple yet useful investing strategy
during such market, such as average down. For people with lesser capital
and high exposure to volatile stocks, a volatile market can influence
their emotion easily and cause them to make wrong move.
If you are reading this article and you are in your 30s, don’t hesitate anymore.
Visit www.investforlife.com.my to begin your investing journey with us.
http://www.investforlife.com.my/advantages-for-people-in-30s-to-invest-in-stock-market/
