Beginner’s Guide to Investing

 

 

 

Before you start, it’s essential to build an emergency fund equivalent to about three months’ salary. This safety cushion protects you in case of unexpected events and should only be invested in highly liquid assets.

Next, take time to analyze your budget and savings capacity. Good preparation is the key to successful investing.

Here are the main types of investments to know:

• An equity is a security representing ownership in a company. By purchasing an equity, you become a shareholder and thus a partial owner of the company. Equities grant rights such as receiving a share of the company’s annual profits called dividends.
• A bond is a debt instrument issued by an entity, representing a loan made by the investor. The bondholder usually receives periodic interest payments called “coupons.”
• An investment fund, also known as a collective investment scheme, is designed to hold and manage a portfolio of financial or non-financial assets on behalf of multiple investors, according to a predefined policy and objective. It is managed by a professional financial institution, called an asset management company.
• ETFs (Exchange-Traded Funds) are investment funds traded on stock exchanges. They aim to closely track the performance of an underlying asset, usually an index, and often focus on a specific sector, geographic area, or asset class (e.g., commodities).

 

Before investing, ask yourself the right questions:

 

• What are your goals? Retirement, buying property, additional income?
• What is your ideal investment duration?
• Are you cautious or willing to take risks for higher returns?
• Are there areas you want to prioritize or avoid?

 

Your answers will guide you toward the most suitable investment solutions for your profile.

The golden rule: the higher the expected return, the higher the risk.

Example: a savings account is safe but offers low returns, while an equity may offer high potential… at the cost of volatility.

It’s crucial to find the right balance between risk and return based on your investor profile (cautious, balanced, dynamic…). 

Financial markets naturally fluctuate. Some investors panic during temporary downturns and sell at a loss, while others get caught up in market hype and buy at inflated prices.

Stay rational: avoid emotional decisions driven by market movements. A long-term strategy is often the most rewarding.

Investment funds are ideal for beginners: delegated management, instant diversification, and professional support.

However, not all funds are equal. It’s crucial to select them based on your needs and values.

At BGL BNP Paribas, we offer a wide range of solutions tailored to your goals and values.

More and more investors want their savings to have meaning. Responsible funds (classified as Article 8^* or 9^** under SFDR regulation) incorporate ESG criteria (Environmental, Social, Governance).

 

BGL BNP Paribas offers comprehensive and diversified solutions that allow you to invest with sustainability principles in mind, aligned with your personal objectives.

Investing is about building your future. By staying informed, defining your goals, and diversifying your investments, you lay the foundation for a solid and sustainable strategy.

Before you begin, complete your investor profile—a key step to investing in compliance with MiFID regulations and with full awareness.