What to Do When My Portfolio Caught on Fire?
Once upon a time, a Young Man lived alone in the city and wished to buy a house. To buy his dream house, he has calculated how long he has to work. However, he also knew an invisible monster that could kill his dream if he did not recognise it. This monster was called Inflation. Hence, he was looking for weapons to beat Inflation.
Long story short, after learning here and there, the Young Man found a weapon called Investment to beat Inflation. But, his journey wasn’t over since the weapon can burn his dream too if he does not use it carefully. So, what should he do?
Moduers, have you ever been on a similar journey to the story above? You have financial goals, but to achieve them, you need a weapon which is the investment to beat inflation so You can achieve your goals. However, when using the weapon, it might burn your goals if you don’t know how to use it wisely or extinguish the fire when it burns your investment portfolio.
Indeed, in investing, sometimes potential loss might happen. This potential loss is indicated by a red minus number like a fire on your investment portfolio. Then, the question is, what should we do when our investment portfolios are caught on fire?
Find The Source of The Fire
Investment value will decrease when the price of assets in the portfolio decreases. Assets price decreases can occur due to various factors such as inflation, interest rate changes, economic and political changes, et cetera. Therefore, when the potential loss happens, you should calm down first and determine why your investment portfolio decreases.
Look at The Distance Between The Fire and Your Goals
After finding where the source of fire is, look at the distance between it and your financial goals. Does it look like you have to try to see if your portfolio value has decreased when your goal is near? If it does, you can redeem your potential loss assets or switch them to another so the potential loss won’t get bigger. However, if your financial goal is still far away, there is nothing wrong to keep it that way, or you can also top it up like you usually do because the potential loss is not an actual loss until you redeem it.
Keep Going until You Reach Your Financial Goals
No matter how significant the fire or potential loss is, make sure you keep learning and trying, Moduers! Because as in real life, there is a fire, but you can use it for cooking, warming the body during the cold weather, etc. There is a potential loss in investing, but you can learn to be careful so the huge investment losses that might drain your assets won’t happen.
Always equip yourself with knowledge of investment and keep practising since knowledge and experience can also be powerful weapons against any monsters that will hinder you from achieving your dreams.
You can also follow Moduit’s official accounts below to improve your investment skills so you can achieve your financial goals.
YouTube: Moduit Digital Indonesia
LinkedIn: Moduit Digital Indonesia
Happy learning, and keep thriving, Moduers! Salam Moduit!