Investing is, in many ways, an odds game. You run a slight risk any time you make an investment, and that can be scary to a lot of people.
That said, the risk you incur with an investment doesn’t have to be substantial. In a lot of cases, the risk of investing in a stable investment is so small that most people would never take a significant hit.
It’s also enticing to try and beat the odds with riskier investments. There’s a balance that needs to be struck if you want to have an investment portfolio that takes you where you want to go. We’re going to talk about stable investment options today, looking at how to structure your portfolio for long-term growth.
Let’s get started.
The Importance of A Stable Investment
Most advisors will tell you that your investment portfolio should strike a solid balance of high-risk, medium-risk, and low-risk investments. Generally speaking, the higher the risk, the more money you could make on an investment.
That fact leads a lot of people to play their odds and get burned in the process. We all want to make millions of dollars with no effort in a short amount of time. It’s not that easy, though.
The real money comes from your stable investments. The bulk of your portfolio should consist of long-term investments that hold very little risk. These investments might grow at a rate of three or four percent every year for a period of decades.
That small percentage compounds upon itself, and the two thousand dollars you tuck away this year might turn into two million dollars by the time you’re in your 70s.
You can use some of the returns you gain from your smaller investments to distribute cash into risker investments. For example, you might dedicate ten percent of your portfolio to mid-to-high-risk investments.
You get lucky and send a large sum back into your accounts when you sell. On the other hand, you might lose the whole investment. In any case, it doesn’t matter that much because ninety percent of the portfolio is still growing.
Finding Stable Investments
One beautiful thing is that you have a lot of current opportunities to invest in stable stocks.
Typically, savings accounts are a great spot to place the bulk of your money. There are account options that grow at around three percent a year and hold almost no risk.
Bonds are also another great opportunity for low-risk investments. You can also put a lot of faith in massive companies that show a history of growth and pose little risk of ever shutting down.
When you invest in companies, though, it’s important that you monitor the market and keep tabs on how they’re doing. Even companies like Walmart hold the chance of going under.
Interested in Stable Stocks to Invest In?
Finding a long-term, stable investment can be difficult to do at first. There are a lot of options to explore, though, and you’ll pick them out more readily as you start researching the market. We’re here to help.
Explore our site for more ideas on how to invest in stocks of all risk levels, manage your portfolio, and more.