Investment: what should beginners start with?

One should ask oneself what the goal of the investment is?

And how much risk one is willing to take?

How long should the investment last? When would I like to dispose of the money?

Automatically we end up with the magic triangle of investment:

This triangle is magical because all criteria cannot be met at the same time.

Security and return are largely mutually exclusive. The higher the return on an investment should be, the lower the security will be in the process, and vice versa.

And in the case of a closed-end real estate fund, security may be high, but liquidity low. By the way, this also applies to fixed-term deposits.

As a rule, not all three criteria are fulfilled at the same time for an investment.

Therefore, one must ask oneself what one wants to achieve. Which risks are acceptable and which are not. Try your luck and think about the amount you would like to start with.

Which asset classes are suitable for an investment

Guaranteed income – for example in bonds – can be a blessing on the one hand, but on the other hand they have not really made anyone rich yet.

The willingness to take a reasonable risk is the most valuable characteristic for a private investor. To do this, you need to know your risk-bearing capacity.

It is advisable not to overestimate one's abilities in this respect.

To earn income from investments in structured financial products (derivatives) or investment and endowment insurance, you usually have to wait until the expiry of the contractually agreed term. You are less liquid.

On the other hand, other instruments such as stocks, bonds, mutual funds and ETFs can be purchased at any time through the stock market or. Investment company can be sold, which would ensure the liquidity of these investments.

Duration of an investment

How long one should invest depends to a large extent on the savings goal.

In any case, you need a liquidity reserve to be able to pay for expensive car repairs or a new washing machine, for example. This would be an example of a short-term savings goal. Investment instruments that can be considered are savings accounts, overnight money, time deposits or money market funds.

Equity capital for a property, on the other hand, is more of a medium-term savings goal. Just as for long-term savings goals such as u. a. ETFs are the first choice for private pension provision. Mainly because here you get a very good risk diversification included, at least with a world stock index.

Why ETFs are unbeatable for private investors

ETFs have several advantages for private investors:

  • They are easy to understand
  • You are cost-effective
  • They can be bought and sold on the stock market at any time, and
  • You have a built-in risk diversification,

because they each track a specific stock market index.

In the MSCI World Index, for example, the index includes over 1.600 different stocks from 23 industrialized countries worldwide.

Recommended rules for an investment

There are no special investments for beginners, but there is a golden rule: never invest in financial market instruments if you don't know how they work.

Even if you want to invest with the help of a financial advisor, try to fully understand the product you're being offered.

  1. To which risk category does this investment belong?
  2. Can I lose a part of the amount or the whole amount and under which circumstances?
  3. Is this investment liquid (how easy is it to sell it in the market)?
  4. Will the income be regular or is the profit expected only at the end of the term?


The ideal form of investment for all cases does not exist. It always depends on the savings target and its maturity and on the investor's risk tolerance.

However, if you create a balanced ETF portfolio of bonds, stocks, and real estate, you can likely easily achieve long-term savings goals.

And for short-term savings goals are suitable u. a. Overnight and fixed-term deposits, because there are no additional costs there.

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