Types of Investors
An investor is a private person who allocates resources with the hope of gaining an economic advantage or in some case a present financial return. Most of the time the investor buys some particular species of commercial land for the development of his business. Usually investors buy land without even conducting any survey or investigation about the location and suitability of the proposed business. They are not aware of all the local laws that govern commercial real estate. In such cases it is advisable to hire the services of a professional real estate agent who is aware of all the localities and regulations. One can also research on these laws and regulations through the internet and official websites of various states.
After deciding to invest, the next step is to find out the best investment type for him. There are several types of investment but most investors go for one that they are comfortable with. The best way to do so is to get the right answer to the question in the initial stages. Once the right answer is found then the investor can proceed further.
There are two types of investment strategies which can be followed by an investor. Either he can opt for an approach which focuses on short term gains or long term stability. Both these strategies go for achieving the same ultimate aim of investing in order to achieve financial freedom. It means that if the investor opts for the short term goal then he will have to continue with his present routine until he gets the desired level of returns. If on the other hand he chooses to stick to the long term goal then he would need to continue with his present set up forever.
The Different Types of Investors
There are several advantages associated with either of the investment strategies. An investor type who focuses on short term benefits is more likely to feel the effects of inflation sooner than the investor type who looks for long term security. This is because in case of inflation the former would demand higher price of commodities like oil and gold as compared to the later. Since the latter invest in stocks then there are always opportunities of getting a higher level of return for the invested amount.
In general the investor type who opts for the short term goal would need to continue to spend most of his time working on his current stock market activities and also buying and selling shares to increase his profit margin. A major disadvantage of this kind of investor is that he would miss out on the bargains that may occur suddenly in the stock market. For this reason the investor would not be able to attain the peak levels of returns. However in case of doing research work online for the various mutual funds which are available investors can get to know which ones suit their requirements better.
Another type of investors who can be categorized as medium term investors are those who invest in shares of stocks which are currently undergoing the introductory stage. They are usually short term traders as they have a minimum of time frame to enjoy the benefits of such investments. This group of investors may not take long term investments. Instead they make short term purchases of shares at prices which might go up from their purchase. As the saying goes the money invested in the beginning pales in comparison to what one invests later on as the stock market experiences volatility. Therefore such investors should be prepared to deal with a lot volatility in the market while trading.