Why invest?
Investing is buying certain assets with the aim that these will produce a profit or income in the future.
This benefit may be because the price of the goods we buy increases its value, because owning assets gives us the right to obtain an income or participation in profits generated or a combination of both. In other words the action of investing involves a decision on asset allocation.
Like it or not, all property value changes frequently and therefore change their relative values. So the mere fact of having goods are participating in the game of asset allocation. Like it or not our assets or what is the same as our total assets that have changed in value and thus change the purchasing power that they give us.
In this situation we have two choices:
• Invest consciously or what is the same view, analyze and decide where, how and when to allocate assets to different types of property for the purpose of obtaining from them the maximum future benefit.
• Do not invest consciously or what for many people is "not invest" because they do not consciously decide where, how and when to allocate assets and leave these in the form in which they received, usually cash or converted into cash or deposit it in a bank account. In itself this is an asset allocation decision even though some people do not see it that way, with this decision, the benefits depend on luck in how we receive the goods and whether it is cash or a deposit in a bank account most likely in the short term and long-term security is that our buying power is reduced.
Historically, inflation has always been positive, so that if we maintain our purchasing power is effectively reduced. Also historically inflation was higher than the rates banks pay on deposits as well if we maintain our assets deposited in a bank will always lose purchasing power.
I think it is better to be aware of as an asset allocated, but this does not mean we should all take time to maximize the way to go, perhaps many prefer to leave your assets in a bank account for more than aware that this is their reduced purchasing power. The decision to form an active part in the allocation of assets is a very personal decision and I think come into play economic and noneconomic factors. Some of these are:
• The time available, time is a scarce resource and we must decide to spend it. We may not have time to do other things that we like and prefer to do these instead of devoting that time to decide on our investments.
I do not think that the main goal in life, or that one of the principal is seen to increase the equity you have. In my case I have many others, being with my wife and my daughter, being with my family and friends, traveling, playing tennis, golf, etc. The increase my net worth is between these objectives directly, it is indirectly.
To make the activities that give me pleasure must have time to do it and the money for them. It is therefore necessary money.
On the other hand to increase the value of assets and to build future profits or income in the future may allow more time to devote to the activities we want to do, because we could stop doing or spend less time on activities that need do today to get benefits in the future can be replaced by those generated by the investments made.
Also there are different ways of managing investments, some require more and some require less time commitment. In my case I spend 8 hours a week.
• If we like it or not the business of investing: having an interest in investing activities is essential to pursue it, as it is based to engage in any other activity. This interest we have done and learn about how to invest or in the future we will be interested in learning. Will prefer to devote our time to study or to make investments rather than for other activities.
There are many people who enjoy engaging in investment. Enjoy talking on investment with their friends and family. Many to seek investment in order to highlight unusual for her extravagance, even though this investment is not the most profitable.
Perhaps many do not like so much to invest, but we must also assess how many other things we like to do to keep our home and family. May prefer to devote some of our time to invest today for the future to leave to devote some time to tasks that we must make less than perhaps we like to invest. Here again I think it is a scarce resource allocation time.
• If we are trained or not: I think it's important to have the knowledge to invest. If we can not buy them and when we have the knowledge I think we should start practicing with an equity investment low. It is important to know oneself as well as investment knowledge and behavior requires a certificate and this is to train it, so it is advisable to do this training before committing larger amounts of money.
I think the experience, consistency and behavior are essential. The psychological pressure is very strong and we must act rationally all the time, we do so can lead to losses and these we can reduce our interest in investing. It is important to start investing experience with a lower portion of our capital and then little by little as we leave feeling more capable, confident and have lived periods of gains and losses be increasing the capital that we are assigning.
In conclusion and in response to the question whether we should invest or not to believe that we are making investment decisions and it is best to take them in a consciously. In my case I decided to enter the world of investing, because:
• I enjoy the business of investing, analyzing companies and to monitor them. Investing is another distraction, perhaps you would even if I lost some money, but fortunately this was not the result I got so far.
• I can spend time analyzing the stock market and gives it the necessary and I believe it is an activity that interests me.
• I feel qualified to do so and makes my interest is always researching and studying the matter.
• I have an economic objective, that of achieving financial independence in this way to spend more time on activities they enjoy most, but surely continue to devote significant time investment and that to me is an activity I enjoy.
