Look. There are many investment vehicles around for you to choose from.

You name it. We have bonds. Real estate. Fixed deposit. Currency (FOREX). Gold. Silver. Commodities. Structured deposit. Money market fund.

All have their pros and cons.

But we are going with just one as our chief investment choice - stocks.

Here’s why we think stocks are HOT:

1. Long Term Returns

Stocks traditionally outperform other investment vehicles such as bonds over a period of time.

Stocks have also historically proven to generate positive returns over the long run.

2. Dividend Income

Dividend income from stocks adds on to our investment gain. Dividends give us more cash for reinvestment.

Or we can simply use it for living expenses. Neat.

3. Liquidity

The stock market is a beehive of activity. For most parts, stocks are highly liquid.

You can put your money in, and then decide when you want to come out.

You decide today is the day you want to get out, and you can sell it immediately. No problem.

For investments like real estate, it is more tricky, as it is harder to find a buyer.

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Everything in life entails risk.

You are taking a risk when you cross a road.

If you are not careful, you may get knocked down.

You are taking a risk when you start a new business.

If you do not know the supply and demand of your niche, your business may end up as a flop.

The same applies to Investment. No exceptions.

Doing investment, especially stocks, is definitely not for the faint hearted.

Before delving into it, knowing exactly the kind of risk that investment brings is extremely important.

Not only should you understand the risk involved, but also your risk tolerance level and a few other factors.

Let’s jump right into it, shall we?

What Kind Of Investor Are You?

All of us are unique individuals. We come from different background and have different needs. 

We also think and approach things differently.

We have to recognize this important fact - what may work for you may not work for others. Simply put - your mileage may vary.

Don’t start investing before you ask yourself the following vital questions:

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This question never fails to irk me.

Everytime.

Now, before I go on, let me recount to you a story I remember vividly to this day.

Many years back, I was discussing investment with a dear friend of mine.

His family just got burnt in the stock market because his dad speculated dangerously with wild abandon.

The result - a whopping MILLION dollar gone down the drain!

He passionately ranted to me that the stock market is like a casino. It is for gamblers. You’ll never win.

Dabble in stocks and I’ll end up like his dad, he advised me.

I knew he was still recovering from the trauma of his dad’s big loss, so I didn’t want to say more and listened quietly on.

It had a major impact on me then as it was the first time I actually knew of someone who lost such a humongous amount of money.

And this story brings me to the topic I’m gonna discuss today.

Is Investing Similar To Gambling?

There is still a widespread perceived notion that dabbling in stock is equivalent to gambling.

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