Basic principles of investment

The basic principles of investment are foundational guidelines that help investors make informed, smart, and disciplined decisions to grow their wealth while managing risks. Here's a breakdown of the key principles: 1. Start Early - The earlier you start investing, the more time your money has to grow through the power of compounding. 2. Set Clear Goals - Know why you are investing - retirement, education, house purchase, etc. Goals will guide the investment amount, type, and duration. 3. Understand Risk and Return -Understand your risk tolerance and invest accordingly. 4. Know What You Are Investing In - Understand the product before investing. Blind investing or relying purely on tips can be risky. 5. Diversify - Proper assets allocation 6. Invest for the Long Term - Long-term investments tend to perform better and reduce the impact of short-term market volatility. 7. Monitor and Review Periodically - Review your portfolio regularly to make sure it aligns with your goals. Make adjustments if your life situation or goals change. 8. Stay Disciplined and Avoid Emotional Decisions - Avoid panic selling or greedy buying. Stick to your plan. 9. Control Costs - Watch for fees, commissions, and taxes — they can eat into returns over time. 10. Keep Learning - Investment is a continuous learning process.