In this era of investing, new investors are born every day. This new generation of investors, typically young adults, are intrigued by the idea of investing and enticed by the ups and downs of the stock market. Such is their interest in investing, so many enter the stock market without knowing much about it, with the hopes of achieving their dreams within the shortest period of time. Lured by the temptation to make quick profits, many young or inexperienced investors rush into the stock market without adequate knowledge.
There are those who, upon hearing how their friends got burned in the stock market, either promise themselves to stay away or caution themselves to learn more about investing before entering into a highly volatile market. After all, prevention is always better than cure. To them, it is senseless to gamble away hard-earned money that can be put to other money-generating uses.
In the world of investments, those who are not knowledgeable or have the wrong perception about investing can be classified as beginners or novice investors. Among these novice investors, we may classify them into two categories of investors: risk-averse investors and risk-taker investors.
Risk-averse investors are conservative investors who constantly look for ways to minimize investment risks as much as possible. By attending courses and seminars and reading books, they hope to acquire investment knowledge ...