Investing wisely: focus on what you can control

INVESTING is rarely simple, and knowing where to focus one's energy can be a challenge.

- ALEX ODENDAAL

As we know, markets respond instantly to political headlines, economic data, and global events - and it’s easy to get caught up in the noise of the day. But focusing on factors beyond your control is both frustrating and unproductive. Long-term investors are far more likely to succeed when they focus on what is within their control, such as:

Investment goals:

Whereas speculators aim to make as much money as quickly as possible, investors take a more strategic approach that begins with goal setting.

While market returns are outside your control, keep in mind that well-defined investment goals can act as an anchor, guiding decisions and filtering out distractions. Goals help you focus on the returns you need to achieve your objectives, rather than chasing market trends.

Asset allocation:

While you can’t control inflation, you can decide how to allocate your assets. Asset allocation, encompassing equities, fixed income, property, and cash, strikes a balance between risk and reward, helping to protect the purchasing power of your money over time. Because each asset class carries different risk and return potential, aligning your allocation with your goals can temper the impact of inflation and provide a more stable path toward your objectives.

Diversification: