Posted on 29 June 2012.
Using an aggressive investing style can lead to major success, but has a higher chance of greater loss; this is not a style for those that do not have money to lose. A conservative investor will be happy to accept lower profits, because he or she feels that there is almost no chance of losing money; the other side of the coin is the investor who wants to gamble on the next big thing. Betting on multiple pink securities hoping that one becomes the next blue chip is a definite sign of an aggressive investor. There is always a danger in being too conservative of an investor: Inflation.
A person who is a heavy conservative has one major danger looming over his or her head; that danger is inflation, because the secure safe investments may not have high enough returns to cover inflation. Aggressive investing is needed, at least to a point, to ensure that the time spent investing will be worth it in the end; it is also a young man’s game, because there is always more time for mistakes. People that are retired will sometimes be happy to make back just the inflation on their investments, because it means they can continue to live life at the same level they already are.
The aggressive investor will always be looking for ways to improve his or her profile and will often take risks that no conservative investor would ever think of; the idea behind it is that one winning stock will make up for ten losing stocks. A young investor has lots of time to try and find that winning stock which is worth ten thousand losing stocks and allows him or her to retire early. An aggressive investing style will eventually lead to a more conservative nature as the investor grows older and looks to retire.
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