1. Never invest more than 5% of your Capital in one investment.
2. Diversify your investments in at least 5 different industries.This could be 20% in financials, 20% in real estate, 20% in health, 20% in tech, and 20% in industrials, etc. You could further diversify into foreign and U. S. stocks and bonds. Ecclesiastes 11:2.
3. Have an exit strategy. Never let a single investment drop in value more than a maximum of 25%. This 25% exit price should rise as the value of your investment increases. Use a “trailing stop loss.” Sell your losers and hang on to your winners.
4. Do not force your money to impossible earnings or high risks. Do not speculate with your money.
5. Guard your principle.
6. Use a financial advisor or counselor. The study their recommendations prior to investing. Be educated enough to make an intelligent decision.
7. Be considerate of your family and make a Will. Also, make a list of all of your financial accounts, including retirement accounts, complete with account numbers, safe deposit boxes and where the keys are located. List all life insurance policies and where they can be found. Then, give all the above information to one or more trusted family members.
8. Finally, the key to building your investment portfolio is CONSISTENT SAVINGS. Take a portion of all income and consistently invest it using the recommendations listed above. I recommend a minimum of 10% of your income to be set aside for savings and investing. The earlier in life you start savings, the greater your wealth will build. Truthfully, if you don’t do this, the other recommendations will probably not be useful because you will not have anything or at less very little to invest.
ALL OF THIS INFORMATION AND MORE IS LISTED ON PAGES 64 THROUGH PAGES 66 IN THE BOOK.