When some people think of investing, they focus on the potential for great rewards—the possibility of buying unknown stocks that increase in value many times over. However, it's equally important to understand the potential risks and the possibility of losing money in the stock market. Investing in the stock market can be a roller coaster ride, with no guarantees of success.
Here's what experts say you should consider before investing in any one individual company. Diversification is key, as it helps to spread out the risk. Instead of investing all your money in a single stock, consider building a portfolio of different stocks across various industries. This can help minimize the impact of any one company's poor performance.
About 60% of millennials aren't investing in the stock market, many times because they're afraid to lose their money. It's crucial to recognize that there is always a risk involved in any investment, and the stock market is no exception. However, history has shown that, over the long term, the stock market tends to recover and generate positive returns.