Investing is one of those things that everyone knows they should be doing. However, tons of people aren’t investing. The main reason for this is simple. At the end of the day, the average person simply doesn’t know how to build a profitable investment portfolio. So today, we’ll go over the steps to building a perfect investment portfolio from start to finish.

Step #1: Think About Your Goals

The first step to building a strong and prosperous investing portfolio is to consider your goals. Ultimately, before you can create a portfolio that’s tailor fitted to you, you’re going to need to know what your needs are. Are you investing as a way to save for emergencies or save for retirement? If so, chances are that the moves you make will be different than the moves someone would make if they are looking to make investing their full time income. So, the first thing you’ll need to do is sit back and think about what you plan to accomplish when you start investing.

Step #2: Research Investment Vehicles

Now that you know what your goals are, it’s time to look into investing vehicles. The truth is that there are tons of them out there, each coming with their own risk/reward profile. Considering your goals, think about which investment vehicles will work best for you. For example, if your goal is to save for retirement, you’ll likely want to go the slow and steady, yet very safe route. This includes using a mixture of stocks and bonds. However, if you are looking to make investing your full time income, you may want to consider high risk, high reward investment vehicles like forex, retail binary options, and more along those lines.

Step #3: Research The Market

Now that you know what investment vehicle you’ll be using, it’s time to start doing your market research. Ultimately, your investment vehicle largely dictates the corner of the market you’ll find yourself in most often. So, considering your investment vehicle, start doing a bit of research to see what causes the corner of the market you’re interested in to move. After all, when you invest, your ultimate goal is going to be to make money off of these movements. By knowing what causes the movements, you will make more accurate predictions, leading to more profitability.

Step #4: Learn About Strategy

No matter what you’re doing in life, strategy is important. If you’re a mechanic, you may have a strategy for pulling the transmission out of a car. For investors, strategy is centered around two things. Ultimately, strategies are designed to reduce risk and increase profits. Some strategies will be created for those with a higher appetite for risk while others will be made for those with a lower appetite for risk. Nonetheless, there’s definitely going to be a few strategies out there that will work perfectly for your portfolio.

Step #5: Practice Your Theories

One big mistake that most beginner investors make is using their own money first. However, the old saying rings true…. practice makes perfect! Many brokers offer virtual accounts where you can test everything you’ve put together in the steps above using virtual money, not real dollars and cents! Us a virtual trading platform to test your theories and make sure that when you do start using real money in the real market, you’re making money, not losing it.

Step #6: Start Profiting

The final step is to take everything you’ve learned and compiled and throw money at it. Once your virtual account shows you that what you plan on doing will work, start investing with real money and making real profits!