How to pick the right asset
Derrick Lau | 23 Nov 2018 00:30
Saving money is something that most of us can do easily. Simply ensure that your expenses do not exceed your income and if it does exceed, simply discipline yourself.
But saving alone hardly makes us money. Especially with the silent hand of inflation taking away its value as time goes by. Housing prices being unaffordable and rapidly rising cost of living are common woes in our society today.
Doing nothing and keeping the money in the bank, even with interest, will guarantee that we have reduced purchasing power over time.
Therefore, one way or another, we will be forced to find ways to make our money work hard as well by investing it. But then the challenge arises – what do we invest in?
In today’s world, we are spoilt for choices. There are stocks, forex, bonds, real estate, gold, commodities etc. We have heard both failure and success stories in all of them. Therefore, it is understandable that amateur investors would rather just pass the job to a trained professional to save themselves the headache.
Legendary value investor Warren Buffett gave a very concrete understanding of assets which, if understood, could change the way you invest forever. And that is to differentiate between productive and non-productive assets.
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