Misconception number 1:
One doesn’t talk about money

You probably know this from your friends and family: When does anyone ever talk openly about finances? In some cases, not even a person’s partner knows how much one earns exactly. It seems to be an unwritten rule: One doesn’t talk about money. The basic attitude is apparently: How much one earns and how one invests one’s money should be no concern to others. Money matters are considered to be very personal. One rather wraps financial things in a blanket of silence. However, people who don’t talk about money also don’t talk about what one can do with money. What opportunities and risks are involved in the various investment options? Which investment options are most suitable for your personal circumstances and investment goals? Know-how, experience, and market knowledge: With whom one speaks about suitable investments is particularly important. Because money matters are a matter of trust. So, talk to us about your money. Make an appointment with your advisor at Raiffeisenbank a.s.

Misconception number 2:
Long-term investments are no longer worthwhile

The interest rate level is at a sustained low. The interest one receives for assets invested in traditional long-term financial investments such as savings accounts or building association savings agreements hardly offer a realistic opportunity for capital preservation. And notable returns are very difficult to achieve with these instruments. Looking at the balance statements leaves one frustrated. People who invest money want it to multiply. Investment funds allow the earnings opportunities on the financial markets to be tapped. However, there are some risks and also costs that must be taken into account. Identify your goals in life and by when you would like to achieve them. In this way, you can determine whether funds are a suitable investment opportunity for you (How do I find the right fund?).

Misconception number 3:
Interim price losses don’t worry me

There are no investments that only provide opportunities for profits. There is always a certain level of risk involved. It is totally okay for you to accept a higher risk in exchange for greater returns for a portion of your financial investments. However, you should always be aware of the risk involved. Find your comfort zone between risk and returns. The selected financial investment should definitely be in line with your own risk tolerance.

Misconception number 4:
I know a sure bet

Had I only bought shares in company XYZ a few years ago, then my investment would have increased X-fold by now. These kinds of “success stories” about financial investments which bet on a single card fuel fantasies of finding the ultimate investment. However, one all too often forgets that one could just as easily have lost a great deal of money if one had bet on the wrong horse, so to speak. Acquaintances, colleagues, media, and the social media: so-called “sure bets” promising high investment yields come from all corners. And one doesn’t want to miss out on a good investment opportunity, right? One basic rule for financial investments says that high returns go hand in hand with high risk. This also applies when one puts everything on one card based on such a tip. Investors who spread their capital among different asset classes (e.g. equities and bonds) in different regions and sectors also spread out the risks stemming from their financial investments.

Misconception number 5:
I do not need to understand what I am buying

Numerous apps promise easy forms of financial investment. Investing is only a few clicks away, so they say. But if a person doesn’t understand a financial product, they cannot judge whether the investment is worth it and how high the risk is. This applies to all types of asset classes (e.g. equities, bonds, and funds). Information and basic knowledge form the foundation for every investment. Volatility, Sharpe ratio, or maximum drawdown (Investment fund indicators you should know): The indicators needed to assess investment funds might seem like financial mumbo-jumbo at first. In most cases, however, things are only half as complicated as they sound. With the right advice, you can obtain the necessary insight quite quickly for the selection of a suitable financial investment. Only trust advice of outstanding quality.

Misconception number 6:
Only when I have enough money left over will I think about how to invest it

One does not need to invest a particularly large one-off sum in order to start investing. In the case of fund-based saving (What is fund-based saving?), for example, one can also invest smaller amounts periodically. So, you don’t have to wait until you have saved a certain amount before being able to tap the earnings opportunities of investment markets. If you invest regularly, you can basically start at any time. Please note, however, that fund-based savings are affected by market trends and price volatility. Therefore, capital losses may also be incurred.

Misconception number 7:
Speculating is better than investing

Buying, selling, buying, selling: This is how Hollywood depicts the process of investing in securities, after all. In reality, however, this type of fickle investor behaviour would be extremely risky and time-consuming. Hoping to make a quick buck has nothing to do with investing, or with long-term investment strategies, but is pure speculation. Suitable investment products are selected based on your personal goals, the investment purpose, the investment horizon, and your risk appetite. Stick to your decision and to your investment strategy. Don’t speculate. Diversify your assets in a structured, targeted manner instead.