High Net Worth Investing Strategy
High Net Worth people need a practical non time consuming stock market investing strategy these days. There are many high net worth individuals who either do not have fund mangers look after their money or only invest a limited amount though fund managers. If you are a high net worth person who want to invest using a solid investing strategy then read on.
On the one hand you could simply put your money into a top tier tracker fund and reinvest the dividends to grow the value of your fund. Depending on your age this might work well if you are in your 20s, but if you’re in your mid to late 40s, and 50s, 60s, 70s+ you want to be a bit daring and smarter than those without a great investing strategy.
The following strategy includes most of the important rules to my stock market investing strategy. If you’re interested in the full version with a lot of valuable tips just subscribe to this site for more updates.
Split your investing fund
Let’s say you have $100k to $1million and higher to invest. Depending on where the stock market is at the point you want to start to invest i.e. high or bear low, (maybe following a crash) be ready to split your fund to invest the correct percentages.
If the market is bear and stock share prices are low:
If this is the case, then you are in a good position and have a great advantage. But don’t get carried away. Prices could drop further. I’d say go all in 75% max and hold back 25% for top ups.
Make sure you are buying stocks through a reputable establishment, such as a bank. Maybe open a few accounts with different banks, to mitigate and spread the risk, in case of an issues down the line, given your funds are only insured for a certain amount in some case. You could find a stock market broker that will protect all of your assets. Anyhow, it’s good to invest using a number of accounts.
Choose a range of stocks, diversify, of course in a bear market you will be investing in mostly recovery stocks. But within your choosing make your some are true growth stocks and some are dividend paying stocks. Buy into different sectors.
Don’t mess about buying small and frequent, because you will be paying fees to buy and all those fees add up. Don’t join brokers who do not share buy/sell fees, because they will be micro cheating you on the buy/sell price and/or on the spreads. In the long run when you buy big, you will be saving a lot more (trust me) by paying a fee to your broker, like a bank.
Just decide how much and go all in and move on to buy the other stocks. The amount of share does not have to be a round number. Just decide on the monetary amount. So if you want to buy $20,000 worth in $AAPL, then just do it.
If the stocks crashes further buy at least 10% then think about topping up some more money to average down. The stock is unlikely to fall a lot more, ‘if’ you have caught the bottom or near bottom of the crash. Most crashes are only for a limited amount of time before stocks begin to rise again. So BUY THE CRASH!
Let those stocks ride all the way up, cash out on some, keep some others, hold cash again in your investing account, about 50/50. Wait for another big crash or mini corrections. But overall when those stocks you bought have recovered from a major crash it’s going to be some years before you get another great buying opportunity.
Hold most of you stocks you are in profit on, and look around at investing in some other stocks.
As well as diversifying with most of the well known top stocks, you should think about buying a diverse range of penny stocks. If you can buy then following a stock market crash then you will be getting good value for a long term hold.
If you can be a bit flexible you’re your buying power and even add to your overall fund by topping up with more money, if you have a strong income then you can play the stock markets better than most private investors who panic and sell at a loss through fear. If you can buy their fear and hold through the wavy seas of uncertainty then you will emerge the victor!
In my next post I will expand on buying in a bear market. There is much for you to learn before jumping in, moreover what you should do if the market is rising following a stock market crash?
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