What kind of investor are you?

When choosing the right Mutual Fund, at first we need to check our financial condition, and then understanding how much risk we can take. We canââÅ¡¬ÃƒÆ’¢Ã…¾¢t just choosing by reading the brochure or prospectus.

Each person has different mindset in seeing financial condition and investment. Because of that, investors are divided into two types depending to risk taking and investment style. Then, which kind are you?

Keisei-type investor (investing for growing their fund): this is the kind of investor that actively try to increase their wealth. Usually this type of investors are younger people who need fund for their future events such as: marrying, raising children, buying house, and retirement fund.

Katsuyo-type investor (investing during retirement period): investors of this kind are financially stable and want to invest their wealth regularly, then using the return to fulfill their seconday needs.

However, if you think both of them are not suitable for you who want to get more profit, or investing to double or triple the fund in short period, then Mutual Fund is not suitable recommendation to achieve that.

Mutual Fund is intended for those who have target in the future and achieving it by accumulating wealth, or for people who want investing their wealth to reap the rewards in long period of living.

In country with advanced capital market such as United States, a lot of individual investors are already planning their finance well by doing investment. Most people are predicted to plan short-term investment that run at least 5 years, and long-term investment that last 20 to 30 years. If you are planning for long-term investment, then mutual fund is the most suitable instrument for you

However, one thing that need to always keep in mind. A lot of people tend to think that the purpose of investment is just to multiply their money. In the truth it is little bit different.

Wealth investment is actually the activity when we need to set what actually the goal is, or what is the purpose for increasing the wealth. After that we think how to get the suitable return for us to achieve the target.

Well, after making sure which kind of investor are you, determine what is your goal in investment, and after that calculate what is the percentage of return that you want to achieve.

Before picking the right Mutual Fund, the most important part is to understand our return target. Because we donââÅ¡¬ÃƒÆ’¢Ã…¾¢t know how much risk we can take when choosing Mutual Fund if we havenââÅ¡¬ÃƒÆ’¢Ã…¾¢t think about the target carefully

If we fully understand how much return we need, then we can avoid taking more risk than we need to take. If we only need to get relatively small return to achieve the goal, then we can choose investment that has small risk and small return. No need to take more risk than is needed.

Calculating return might quite troublesome, but fortunately we can use softwares or tools that are freely available in the internet to calculate it.

Different kind of investors have different ways to determine the investment return. Have you understand which type are you? If you are Keisei-type (investing for growing their fund ), read the next page. If you are Katsuyo-type (investing during retirement period ), please skip 4 pages after this.