Clear and straight rules guide, how to invest money analytics based on fundamental investment principles in combination with our own Boat’s Coin real-life investment examples.
When we are building Boat’s Coin investment platform, our team ask, let’s write in one place general and most reasonable rules for investing money wisely. We feel that if followed, then, we can make good investment place a lot easier and then our investing money platform will certainly be fundamentally correct.
I am listing these rules with our examples transparently for you.
How To Invest Money Wisely, The Main Rules List:
1. How to Invest Money Wisely Means Not Owning Something You Have No Understanding About
This is a major rule that can help you save a great amount of financial risk: Never buy or own anything you can’t explain to a kindergarten in a few sentences or less.
These elementary questions are ways it makes its money, what are the potential drawbacks, and in what way does the money get to me.
This seems very easy, but very few people seem to adhere to it.
One of the main reasons why people don’t follow that rule is because in order to be able to explain something super simple; you must have wider or “bigger picture” at first. And based on our research next reason in line is just lack of focus on investment technique clarity because people focus more on return on investment.
Without any doubt, return on investment is important, but not so first “in line.”
You must clearly understand everything deeply such that you can easily explain to anyone if you wish to invest money wisely.
Very often stocks, bonds, mutual funds, ETFs, real estate investment trusts, contract for differences, investment, linked insurance policies and others are never deep enough to be understood by a large number of investors. Smart investment behavior is to be aware of this fact. If you can’t go deep enough “length and breath” with these type of investments, it is better to find a simpler investment type.
As a real-life example, a few people in our company and I have a long experience in both software development and years of knowledge as sailboat owners. We pretty clearly understand these fields, and we, without a doubt can handle it on a fundamental level.
We connect the dots in the fields that we totally control and based on this thinking get the idea to “redefine yacht charter management industry” with our unique software platform solution.
This is the main reason why we write such a long and educative investment guides like this one, as an example. We are doing it because we wish that every individual involved starts to understand fully and clearly Boat’s Coin investing money platform and investing fundamentals and stay behind the system!
When you get the bigger picture of Boat’s Coin investing with clear investing system understanding, you naturally go on to the level of wise investing behavior.
Additionally, Boat’s Coin investment way is a simple type of investment and really can be understood in pretty short time by anyone.
In short, we “just put” classic yacht charter business on a deeper software-based mathematic formula that can break and calculate boat investment in a large number of a smaller independent piece of investments. (OK and then above that, we build robust API software system that makes it possible for other companies from their websites to connect to our main system).
That’s all in short. This makes it possible for everyone to invest in yacht charter type of business, which was not possible in the past.
2. How to Invest Money Wisely Implies Proactively Managing Risk
A risk is a constant factor when investing money and investing involves you respecting the risk while at the same time reducing it. In the event that you don’t, you can destroy years or even spans or a lifetime of your savings or your other property ownership.
The primary investment risks are the market risk, inflation risk, liquidity risk and investment operation risk itself.
This is one of the reasons why it is highly significant not to concentrate on returns so blindly but on risk-adjusted returns to dynamically strive to lessen risk.
That’s how we proactively make our analyses in Boat Coin’s case:
- Market Risk: Market risk is the risk of losses in positions that happen from unpredictable movements in market prices. Yacht charter is one of most constant businesses and from the first days till now never had radical down moments in history. We are talking about regular yacht charter for the boats from 30 till 60 feet (10 till 20 meters) in size only. The world is becoming “smaller” every day, and global tourism has a long-term growth path. Staying behind sailboats (mostly) and motorboats investments have the radically low market risk. Additionally, boats are tangible assets, and they have a known value. This is not any “virtual finance” instruments as shares, cryptocurrencies and similar to those that have been unstable in their fundamentals and had constant “bubble” tensions.
- Inflation risk: As we all know; monetary inflation is constant in the tendency to increase only in the money supply looking through humankind history. We have USA and EU based offices, and our main used currency counted in investment transactions in USD. Generally, people do not have a lot of choices here; you can use USD or EUR mostly. Inflation risk exists by any money transactions. However, our main assets are boats, and they are not any money type of currency. This makes foundations of our business pretty stable and not connected to high inflation risks. It is the similar effect when people invest in gold, but just yacht charter have lots of more predictable yearly profit because gold can fluctuate up or down the more because of finance marketplace fluctuations.
- Liquidity risk: Liquidity risk is the risk originating from the lack of marketability of an investment that can’t be sold or bough fast enough to prevent or minimize a loss.
Here, one must ask itself when that type of risk usually happen? Liquidity risk comes to be from situations in which a company that is trading an asset is unable to do it because nobody in the market is interested in trading for that asset and this company cant have money enough to pay usual business costs anymore at that moment.
In our case, we solve that element through answer at first point by market risk analyses. Yacht charter is one of the most constant businesses, global tourism and traveling just increase every year and boat itself is “movable asset.” If some large tourism downside happens in one country, yacht charter boats are moved to another area usually. Tangible assets are just radically harder to depreciate. And virtual assets are fully opposite; any virtual asset can devaluate to the level of worthlessness more easily.
- Investment operation risk itself: Depends on the type of investment, investment operation risk itself falls into main investment risk categories.
This part by Boat’s Coin is solved as usual in yacht charter business. All our boats have full insurance (Casco) from the full list of damages. We have insurance for the cost of minimizing damage when an accident has already occurred and during the boat save attempt on top of all. Any potential boat investor risks are covered in this way, with wide insurance policy terms.
If we go back to savings example again, many people are not aware of the level of banks capital adequacy ratios (CARs) in today’s environment. Capital adequacy ratios are a measurement of the sum of a bank’s core capital shown as a percentage of its risk-weighted asset.
Under Basel III international bank regulatory, the minimum capital adequacy ratio that banks must totally maintain is 8%. Chinas banks CAR is 11.5%. You have in EU banks that work with 3% of CAR (Italy and Greek) etc.
So just thinking of old habits in the past that savings are the “safest” way is pretty wrong today. How much is safe capital from today’s banks with so low CAR?
Looking through these facts, this all makes an example of Boat’s Coin, one of safest low-risk investment ways.
Return on investment risk is radically low through all major investment risk points of analytics.
3. How to Investing Money Wisely Implies Organizing Your Holdings and Acting in a Manner That Allows You to Minimize Taxes
The higher you are able to save on taxes, the greater the money you have working for you.
We do not advice to cheat on taxes, but take advantage of all of the legal tax-lowering options has given you under the law. We as a company work in that way as it is a requirement today. If we do not organize our operations in the way that make our corporate taxes lowest possible, we’ll easily lose this profit that we share with investors.
Also, we advise every investor, investing is not the same as local business work. Investing can be done through the country of your choice. So, whoever invest wisely find countries with business administration and tax laws which climate best fits him or her usually. It must not be for everyone in his country of residence.
4. How to Investing Money Wisely Means Monitoring Your Expenditures
At Boat’s Coin, for example, we skip marketing totally to provide the best investment yacht charter management platform that exists.
Our budgets just go in the direction of yachts management and not into excessive brand marketing.
Boat’s Coin develop special API and iframe software solutions that allow everyone to build and earn from own yacht charter management promotion. We don’t work with investors directly.
We are focused on giving other companies, and websites access to our system, and they do all marketing work on our side. We find that way as a win-win situation because anybody who is a company owner can get access to our system and earn on yacht charter management by promoting our services and communicating with end investors directly.
We are building a brand on the strict core value of results, legitimacy, and innovation.
That’s the way we are controlling our expenses; it’s radically lower than most of the other companies doing this and any other types of business.
Regardless of whether you will apply for these investment policies for your private investment or you will use the Boat’s Coin investment platform, I hope you enjoy the article, and you can take a clearer look into fundamentals of investing money.
If you are still thinking, should I save or invest my money, read our article: Investing Money vs. Saving: The Clever Way to Earn the Difference Between Them.
It will be great to Hear from You
If you have any questions or comments, please contact us, and we are going to answer every question as much as we can.