Making intelligent investments requires a different type of thinking. There are tons of magazines, websites, and financial advisers that are going to tell you the current market trends. But going with trends is never a good way to make money in the long term, and that’s something that Igor Cornelsen had to find out the hard way, through time tested experience.
What he’s found over the years is that you have to look at a company’s potential to be productive, and the potential to maximize profit. First off, productivity might not mean what you think.
Productivity in an investment measures the potential that any given good or service has to become more expensive in the future. Take something like gasoline for example. As there is fewer and fewer fossil fuels, there is going to be less gasoline, and more demand. That means the price is only going to go up, so investing now almost guarantees some sort of positive movement down the line. The same is true of real estate, as inflation will always push property values up.
But you also need to realize that any given investment is just like owning a piece of a business. That means taking control of a small percentage of a corporation. So an investor needs to determine the potential of a business to make money. Plus you want to take a look at how likely a company is to weather a storm, and be successful in the long term.
Companies that don’t have a huge long term profit potential probably aren’t going to be worth your time or effort.