Wednesday, June 10, 2015

Ability of Investment

Ability of Investment
In europe as in other countries, the gap between rich and poor grows ever wider. One reason is, inter alia, stated that it can only afford "the rich" to invest in equities and may be so pleased with steady asset growth. Here, equity investment and asset accumulation with manageable risk for almost every possible - also in europe.

Ability to investment for everyone?
About the question of what is "rich" or under "poor" to understand, will not be discussed here, as there are many different views at the moment. The fact is that almost every person has the opportunity to build a fortune over a period of more than 15-20 years, then the z. B. retired helping to bridge the pension gap. The problem in Germany is just that most people draw prefer to secure and / or government-sponsored alternatives and so - often without knowing it - build a fortune, but even reduce it over the years.

Who z. B. invests 10,000 euros as fixed or daily allowance now receives just around the 0.1 percent interest, often even less. After taxes, basically nothing left. With an inflation rate of just 1% are of the money in 10 years just over 9,100 euros left. At 2% just over 8,250 euros. And the government-sponsored opportunities for private pension provision, such as life insurance, Riester and Rürup pensions, throw off only minimal returns, bringing hardly a fortune can be built. The same applies to long-running low-risk bonds, which can now earn little more than 1% interest.

In essence, investors only shares of asset accumulation remain so desired. However, here are just the security-oriented Germans years ago, when the German Telekom went public, had a bad experience and partly realized significant losses.

Numerous errors were in hindsight, made: the money was mostly put in a company's shares. Risk diversification did not take place. The remaining money was often used to speculate on shares of new companies in the Internet industry. In the first phase of euphoria and gains many investors who believed they could double the Chapter set up easily and quickly or triple.

Finally, the courses just by companies in the telecommunications industry are long only increased. And who, even though many companies not making money, but "burned". Companies from traditional industries, healthcare, or the food industry who, although not recorded price gains, but always achieved solid earnings and price developments as well as dividend payments have been dismissed as boring.

The consequences are well known: it was a price bubble that has burst and the entire stock market has recorded. Investors have rows must plug significant losses to some extent. Largely because of this bad experience is in Germany, the proportion people who have invested directly or indirectly in equities, declined steadily, even in the past and in some cases in the current year.

The fact that the prices of most companies have not only recovered, but that the indices in which many companies are represented (DAX, DOW & Co.) have more than doubled since, hardly anyone seems to perceive. In order to qualify investors the opportunity to build a fortune, even if one is not "rich".

Because it is for every citizen who can spare 25-50 euros a month, a good chance to earn over a period of 15-20 years a lot of money. This is done most easily when this amount each month into a fund savings plan, and here in an ETF (Exchange Traded Fund). The former has increased despite fluctuations and risks since the launch mid-1980s by an average of about 8.5%. While there have been numerous setbacks, which could be all caught up and overcompensated however. Hence the long period for an investment in shares is so important. You also have bad years not only endure mentally, but also financially "sit out" can. For this you will i.d.R. rewarded.

Who bought z. B. 20 years ago a unique ETF certificate for 10,000 euros to the DAX, now has about 51,000 euros, who has acquired a loan with 4% interest, over almost 22,000 euros. At current interest rates of around 1% is only 12,200 euros (everything before taxes). Whoever acts with a cool head, invested over several years in stocks, and relies on a broad diversification, as with ETF, can build a considerable fortune with modest means and, with a little patience in a few years even to "the rich" ,

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