Wednesday, 16 September 2015

How to diversify your investment portfolio

Image courtesy of Stuart Miles at FreeDigitalPhotos.net

Everyone should diversify their investments this is because investing in only one type of asset and market will make your investments highly risky. Diversifying your investments will minimize your risk to the lowest, thus the losses made from one investment will be eliminated by the profit from another. There are various types of assets you can invest in; First of all, save your halal bank account, share (halal), properties (halal), gold and others. The money you save in a halal bank account should cover one year of your living expenses in your bank. 

After you have saved enough cash, you can now invest in other assets. The percentage you normally save should be used to invest in other assets. 30% of the money should be invested in gold, 30% should be invested in shares (halal) and the remaining 40% should go into savings (halal) that will be used to acquire a property when it is large enough to buy one. When investing in shares you must not only buy the shares of one company or one industry or one country. It will be highly risky to buy the shares sold in only one company or  industry. 

The best industries to invest in are as follows: Construction Industry, Internet/Online Industry,  Leisure, art and hospitality Industry, Oil and gas Industry, Pharmaceutical Industry, and Telecommunication Industry. 

Halal means anything lawful Islamically.

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