How to choose a plan of capital accumulation

How to choose a plan of capital accumulation

Plan for capital accumulation” (briefly referred to by the abbreviation”CAP”) refers to a particular mode to increase your savings, and it is suitable for those who do not have the financial resources available, but may or may not fail to save a few Euros per month, In this article,  I will explain briefly what is the best way to set aside, on a monthly basis, a small fee allowing you to accumulate a little capital over the years.

Before choosing any ”CAP” (whose main advantage is the reduction of the risk component), you have to analyze the market in which you intend to purchase, on a monthly basis. The share of” mutual funds” in this way, even if the market declines, are transformed into opportunities to buy a greater number of shares and in addition, you eliminate the emotional component.

Start saving up

Start saving up

Now, you must make three decisions and the first is (tied to your salary, the amount of money that you are able to accumulate and to your immediate needs) to choose how much to invest initially, identified in advance by your ability to save monthly and duration of the CAP.

The next decision is, however, to choose which market segments you are going to invest in; it is an obvious choice when it comes to a ”cap”, because if the idea is to perform a long-term investment (for five years), it is useless to take a monetary instrument or debt. In fact, the goal is to maximize even the negative peaks of the market, buying a greater number of shares, and take advantage of the time.

The last element of choice is the fund company to trust. You should be obviously looking for the best costs that run on the client and performance: in this regard, there are many tables to search for in the specialized press so give them a try. The ideal is to have your own account online, which is usually  a better choice between the management company ‘s ”mutual funds” or the Exchange Traded Fund (ETF).

By +Nikos Kontorigas

About Nikos Kontorigas

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