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What to consider before investing

Are you ready to start investing? Our guide outlines critical factors to help you make informed decisions before you get started.

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The three core questions to ask yourself before investing are:

  • What do you aim to achieve from each investment?
  • How much money can you safely invest?
  • How much risk are you prepared to take?

Establishing the answers early on will help you determine which investment avenues are best suited to your needs. For instance, investing for retirement will require a more steady and low-risk approach, while looking to make high profits will require a more high-risk approach. 

Below is a list of other factors to consider:


Inflation is the rate at which the value of a currency decreases. Always ensure your return on investment is higher than the inflation rate otherwise your investment will lose value over time. 


Managing risk is an important element of investing. Higher returns typically involve higher risk, ensuring that your strategies align with what you are comfortable with is a must. 


Liquidity indicates how quickly an asset can be sold. For investments made using capital that you might require in the short term, you will want to ensure that you invest in a market that has high liquidity.


Diversifying your investments helps to manage risk and spread rewards. Similar to “don’t put all your eggs in one basket”, diversification ensures that should one asset underperform the impact is greatly reduced. Try to include a range of assets in your portfolio. 


Last but not least, ensure that you are aware of the tax implications of your investment, as tax laws vary from country to country. The responsibility lies with each individual to establish what these are and adhere to them accordingly. 


This article is for general information purposes only and is not intended to constitute legal or other professional advice or a recommendation of any kind whatsoever and should not be relied upon or treated as a substitute for specific advice relevant to particular circumstances. We make no warranties, representations or undertakings about any of the content of this article (including, without limitation, as to the quality, accuracy, completeness or fitness for any particular purpose of such content), or any content of any other material referred to or accessed by hyperlinks through this article. We make no representations, warranties or guarantees, whether express or implied, that the content on our site is accurate, complete or up-to-date.


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