Adopt a strategy

A financial strategy is a specific way of acting that is to enable the achievement of selected financial goals through investments on the stock exchange. The financial goal may be to build savings, increase capital, income from dividends, protect against inflation, or secure funds for the future (retirement, children's education, unforeseen expenses). It is important that the financial strategy is tailored to the individual needs, financial capabilities and situation of the investor and the market. The choice of the right strategy depends on several factors:

• investment objective;
• the time frame of the planned investment – determining how long you can afford to freeze funds;
• acceptable level of risk for the investor;
• the time that can be spent on market analysis;
• Knowledge and skills – Some financial strategies require a lot of knowledge and analytical skills.

During online training, we say that they do not do it directly, but with the help of information shared on their financial portal. We are talking primarily about access to analytical tools, investment advice, market analyses and forecasts, which are worth using, especially if you are a beginner investor. This saves time and makes it easier to make profitable decisions.

Short-term strategy

The goal of this strategy is to profit from sudden, short-term changes in stock prices. A short-term strategy (trading) involves investments that last from a few hours to a few months. Investing involves buying stocks when prices are low and selling them quickly when the value of the stock increases. This involves quite a lot of risk, but it can be reduced by withdrawing the shares if their price drops too much – thanks to this, the losses will be minimal.

Such a strategy allows you to achieve considerable profits in a short time, but requires a lot of commitment from the investor and the ability to make quick decisions. You have to almost constantly follow market analyses and forecasts as well as fluctuations in the prices of purchased shares. This means that you need to invest time and energy in investing and have the knowledge to do so. The main benefit of a short-term financial strategy is great flexibility and the ability to make significant profits in a short period of time. Additionally, short-term trades do not require you to freeze your funds for a long time. The disadvantage may be high transaction fees. In this strategy, smaller amounts of money are usually invested, from several hundred to several thousand dollars. More experienced players invest up to tens of thousands of zlotys in single transactions, but it depends on the risk you are able to accept and your individual strategy.

A great convenience in short-term investing are the functions available on investment portals, which we talk about on Webinar Universe, and especially the ability to set alarms when a certain price of selected shares is reached. If their value rises to a certain threshold, a notification will be sent. On this basis, you can sell the securities, obtaining immediate financial benefits, or decide to extend the transaction, hoping for further price increases.

A special strategy for short-term investing is Day Trading. It is a strategy that involves buying stocks at favorable prices and selling them on the same day when the price rises. This requires quick action and taking decisive steps immediately after the price changes. You also need to be able to predict market changes well to determine which stocks are worth buying and when is the best time to sell them.

Medium-term strategy

Investors who decide on a medium-term strategy invest primarily in companies with solid foundations and a stable financial situation, which record a constant increase in value. In this strategy, the key is the ability to analyze the technical condition and development opportunities of the company and the ability to determine the right moment to enter and exit the investment.

The average medium-term investor invests from several dozen to several hundred thousand zlotys, and the duration of the investment lasts from several months to several years. Thanks to this, a medium-term investment does not require so much commitment from the investor. Still, you need to watch the market and monitor your investments so that you don't end up making losses, which is what we talk about at Webinr Universe.

A medium-term strategy involves less risk and allows for a more balanced approach to investing. Profits are smaller, but more stable, and there is also the opportunity to benefit from dividends. This is a good strategy for people who do not have time for constant financial analysis and are able to accept medium investment risk.

Long-term strategy

A long-term strategy includes investments that last from several to even several dozen years. This way of investing focuses on gradually increasing capital by investing in stable companies with solid foundations and long-term growth opportunities. Long-term investors typically invest large sums of capital with a view to long-term benefits and dividend yields. Long-term strategies are an excellent option for people who do not want to get heavily involved in managing their investments, because such strategies require only minimal involvement – the investor does not withdraw when the value of shares drops temporarily.

A big advantage of the long-term strategy is the reinvestment of profits, which gives the effect of compound interest – in the long run, this ensures an increase in the value of the capital. This strategy also provides greater peace of mind and stability, allowing you to gradually increase your passive income. The disadvantages include low investment flexibility and the need to have the ability to correctly assess market turmoil. Contrary to appearances, a long-term strategy is associated with a lot of risk, because it is difficult to determine the moment when, after a decline in the value of shares, prices have no chance to rebound and the only way to limit losses is to sell securities.

Choosing the right financial strategy is crucial to achieving success in the stock market. However, it should be well suited to the assumed financial goals and the capabilities of the investor himself, both in terms of knowledge and skills, as well as the time that can be spent on monitoring the investment. Personality and the ability to make decisions based on specific analyses and not under the influence of emotions are also important. Each of the investment strategies: short-term, medium-term and long-term has its advantages and disadvantages, which you need to consider before creating your own strategy. It should be remembered that investing in the stock market always involves a certain risk that cannot be eliminated. However, they can be minimized by using financial analyses, expert forecasts and taking an interest in market reports.