In the UAE, the prices of gold have dropped, and the yield of US bonds increased as the dollar index has reached a three-year high. Some investors, on the other hand, are considering cryptocurrency investments, as they are free from inflation and government control. When it comes to potential acquisitions and lucrative returns, every person looks for a profit. However, simply being aware of the asset classes is not enough; one needs to have sound financial education and knowledge about how global events impact the economy to make the best investments.
Kavan Choksi– being prudent with your options before proceeding with investments
Finance and business expert Kavan Choksi suggests people should always have a financial advisor before they jump into investments today. It is true that the gold prices in the USA have dropped, but it has also become costlier for those people holding other currencies besides the US dollar. When it comes to the subject of cryptocurrencies, there still is a lot of confusion about this asset class due to the lack of correct knowledge.
Understand how investments work
He states that one must understand how investments work for them as the financial needs of one person are never the same as another. Inadequate knowledge about the investment asset can cost the person dear in case it fails to perform.
According to him, it is common for potential investors to compare asset classes and choose one that brings in the highest returns at a certain point in time. Though this might sound to be a practical option, experts in finance advise one from doing so. It is not the gold, stocks, or cryptocurrencies that will give you lucrative returns; they will just guide you on how to invest prudently.
Understanding the asset class and how it works
It is essential for one to study the market and observe the performance of investment assets. Taking the assistance and help of a financial advisor experienced in the field will help you know your risks. There is no investment free from hazards, and here you should be aware of how much risk you can bear in case the asset does not perform as per your expectations.
In order to get the best returns from any asset class, investors should understand how it works. Take, for instance, cryptocurrencies. Most people are aware of bitcoin, the first cryptocurrency that emerged in the world. Since its success, there have been several other cryptocurrencies emerging, and each of them has its own pros and cons. When it comes to cryptocurrencies, they are decentralized in nature and highly secure. Blockchain technology is a highly complex and sophisticated network that ensures the transactions carried out with cryptocurrencies are anonymous and private.
However, business expert Kavan Choksi cautions that simply knowing the advantages of cryptocurrencies is not enough. The investor should also be aware of the risks and cons of investing in them. The cryptocurrency market is highly volatile, so he advises that they should constitute just a tiny part of your investment portfolio to them, along with stocks, bonds, and gold.