How to invest for 2023
Share markets globally have been crap – I really can’t be any more blunt than that but over the last 12 months, they’ve been truly awful. This includes those lower risk Conservative funds too.
Of course, there’s things that we can’t control – interest rates, inflation, war, pandemics to name a few. Equally though, there are a few things that we are able to control. I’m thinking about investment timing in particular.
I don’t mean trying to gauge what the market is doing by buying or selling at the best time, as that’s a mug’s game AND it’s impossible to do.
What's the Secret?
That’s where the concept of ‘Dollar Cost Averaging’ comes in. If you are concerned about what the market may or may not do, then consider investing bit by bit, rather than all at once (or a combination of each).
Suppose you have $10,000 to invest now, why not invest a third now, a third in a few months’ time and the remainder later in the year.
If you think that markets are going to rise going forward, then it would make sense to invest fully now but if you think markets will remain turbulent for a while longer, before rising then consider drip-feeding funds in now.
What's the Gain?
If markets fall, you can still gain by investing when prices are low are buying more for your money. If markets rise, you’re on to a winner anyway so it’s a great win-win.
Who knows what 2023 will bring but whatever occurs, you can make things happen to your advantage - especially if you get the right type of advice.
Happy New Year!