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Lighthouse is running a two-week-long series in which we share some of our principles of investment. All you need is an open mind and a few minutes each day. You can keep tabs on the action at the Principles of Investment index.
Now that we have our raw strategic position, a direction, and know how fast we want to go; and you have (hopefully) removed much of the emotion from the analysis; we can see that we truly are in a time of real opportunity. Our challenge now is to establish our investment tactics in such a way that we can exploit market conditions so to capitalise on those opportunities, while concurrently minimising our potential risks.
Surprisingly, the answer here is almost too simple, and as a result, many investors dismiss it because it seems too simple. If the market-place is volatile and difficult to predict with any reasonable certainty over the shorter-term, then ‘stagger’ your investment positions by buying across weeks, months, or even several. This way, time can be your partner, and not your enemy.
If the market drops next month, no problem… you simply buy more stock for the same investment sum. Whereas, if you had made a single investment purchase, you are now little more than a passenger on the high seas, and only able to capitalise on any price drop by finding more money to invest (gamblers call this ‘doubling-up’). If you purchased that position based on the right analysis, such a price-drop does not necessarily mean that your buying decision was originally at fault. There could be plenty of other reasons for any price drop.
This ‘staggered’ positional approach represents a significant factor in risk reduction tactics, yet you compromise little on the profit potential over the medium term. For almost all Lighthouse clients, this is the primary reason their investment accounts are doing so well. It may not be a sexy or particularly exciting approach, but it does work in all weathers!
That’s it folks ! This is the end of this Principles of Investment series. If you liked what you read, and wish to see “How” we deliver this for our clients, do give us a buzz, we can arrange a personal introductory discussion with one of our consultant; after-all, this is the point of this blog, helping you 
