How to earn more with your capital

Guides

Believe it or not, there are still entrepreneurs who believe that if their company is performing well there is no need to worry about thinking about doing different things, entering, without realizing it, in a business comfort zone. All this under the obsolete concept of “If it’s working well, why change?”

The fact that you are reading this lets us know that your vision as a true leader of a capital on which other people depend goes much further. And that is precisely what it is about, vision, knowing that the moment in which your company is doing well is not a time to remain static, on the contrary, it is a time to take advantage of your profits and turn your eyes towards new markets.

We know that no matter how well a business sector is performing or how much stability your company has achieved, when you least expect it, everything could change drastically affecting your numbers.

It is enough to remember companies that have gone bankrupt because they did not have the vision to explore new markets that could have been their salvation in times of difficulty. A clear example is Kodak, Blockbuster and Nokia; if you do not want your company to join the list, but above all, if you really want to obtain higher profits and increase your capital, the answer can be summed up in three words:

Diversify your investment

Don’t worry, we understand you perfectly and we know that at the beginning it may sound quite challenging and even more so if you have achieved prestige in your sector, due to your years of experience.

However, understanding the importance of diversifying can take you to a higher level than you might have imagined, consolidating you as a versatile and innovative entrepreneur with the key characteristic of all this: VISION.

Maybe it is a concept that you have clear, but in financial matters information is never too much to know how to use all this to your advantage and start seeing it translated into positive numbers, so you are in the right place to know in much more depth everything about this great possibility.

THE IMPORTANCE OF DIVERSIFYING YOUR PORTFOLIO

The principle is more than basic and we have heard it a million times: “Don’t put all your eggs in one basket”. Visualize your company’s profits and if you reinvest them all in your own company to make it grow even more, it doesn’t sound like a bad decision at all, but we are talking about a single company. If its share price goes down or goes bankrupt, your entire investment would register a loss.

In other words, your profitability will depend on the results of a single company. However, if you decide to invest in new instruments, your total return will depend on the average return of all your instruments, the gains of some may offset the losses of others.

You know perfectly well that the best decision is to have different financial objectives, with different time horizons. That’s when you need more than one investment product and increase your portfolio to reach those goals.

This allows you to have, little by little, more risky securities, others that are safer, but with less profitability, some short term, others medium term and others long term; the important thing is to maintain a good portfolio that allows you to meet your needs as they arise.

You know perfectly well that the best decision is to have different financial objectives, with different time horizons.

That’s when you need more than one investment product and increase your portfolio to reach those goals.

This allows you to have little by little more risky securities, others safer, but with less profitability, some short term, others medium term and others long term; the important thing is to maintain a good portfolio that allows you to meet your needs as they arise.