What kind of investor are you?

PUBLISHED : Monday, 30 June, 2008, 12:00am
UPDATED : Monday, 30 June, 2008, 12:00am

Finance might sound scientific, but a large part of our financial decisions are not always based on science. Investing is no exception. Psychology has an impact on our behaviour.What kind of investor are you?

Enthusiastic: you have picked up some investments which are going up steadily. Well done! Keep reading financial news to check the long-term prospects of the industries in which you have invested. Be ready to sell to pocket your gains from time to time and reinvest.

Pessimistic: markets are too dangerous! It is better to keep money in the bank. You actually need to have some savings for an emergency. But investing the rest will enable you to protect it against inflation. Diversify your investments. And if your stocks go down, don't forget you have not lost money until you have actually sold them.

Follower: you do whatever the best-informed people advise you to do. But they might have different goals. Write down your goals and strategies and read articles which provide better prospects in the long run.

Rational: you have set your short-, mid- and long-term goals and a savings and investment strategy. You read the news but keep a cool head when the markets go up and down. Investing is for the

long term!