Category Archives: Finance basics

Why you should invest only for the long term

long-term-investingIt is often recommended by financial advisors that people should only consider investing in stocks and shares if they intend to not need the money within the next five years. The main reason for this is that the stock market can be very volatile in the short term. For example, the United States’ S&P 500 index lost nearly 40% of its value in 2008. This would not have been a good outcome for an investor wanting to utilise investments in this fund shortly after the drop. However, there are other benefits of adopting a long term approach to investing, which are often overlooked or which are not widely taken seriously. Continue reading

How to track dividends for stock market index funds

“It pays dividends” – This is a fairly common saying which means that there will be a reward if we put a lot of effort into an activity or purpose. However, depending on the particular activity, it is not always possible to visualise these rewards even though they may not be abstract. A good example of this is the dividends paid by Accumulation stock market index funds. Continue reading