Different Strategic Wealth Creation Principles
Some of the ingredients of traditional investing will
include stocks, bonds, brokers, and banks. But today, rather than creating
wealth, they tend to preserve. The reason behind this is that no matter how
well thought-out your portfolio may be, investment expenses, inflation, and
taxes will greatly impact your attempts at building your wealth.
Wealth creation can be very much within your reach. However,
it will require deviating away from the normal distribution investment
paradigm. Apart from that, entering into the realm of strategy is also
necessary.
If you are among the investors wanting to create rather than
preserve wealth, you must aim toward annual returns of 10% or even higher. You
certainly cannot achieve this by adhering to the traditional bond or stock
recipes or perhaps even in listening to their bankers who tend to provide
generic investment recommendations.
The immense value of client's personal knowledge, resources,
and skills must be at the heart of any successful investment endeavour. You
need to build strengths as well as core competencies to ensure a successful
investment. Most importantly, you need to develop your own strategy based on
significant principles.
7 Highly Interconnected Principles Of Wealth Creation
Build on competencies and core strengths - These are
considered the raw materials necessary for you to succeed.
Grab every opportunity - You need to build on your knowledge
of a specific field. When scanning the environment, you must take a long-range
view.
Use networks - Be sure to keep core competencies at the
heart of your network. Do not forget the significance of weak ties.
Implement an investment strategy that sets you apart from
others - You need to decide where you want to differentiate - an industry,
geography or a niche asset class? Again, build core competencies setting your
apart and apply an indirect approach.
Prevent threats and handle risks reasonably - Risks and
threats might inevitably lead to certain losses. You must manage them through
in-depth analysis and careful selection of the core competencies that must be
developed.
Observe the current trends and cycles - Timing is very
crucial. You must think in cycles. Apply the big picture as well as clarify
your investment horizon. Moreover, ensure strategic flexibility. Most
importantly, be very courageous, creative, and patient.
Implement with efficiency - You need to reduce or avoid
fees. Always implement your strategy at the lowest possible cost. At the same
time, watch out for opportunity costs.
No comments: