For non-professional investors, One of the best ways to secure your financial future is to invest and invest over the long term.
While it may have been tempting over the past few years to deviate from a long-term approach and chase quick returns, now caution is key.
The world economic downturn and the market’s current high valuations mean it’s more important than ever to focus on investing for the long haul while sticking to a game plan.
Mario Alcala, the founder of Socius Investment Banking, a leading investing and financing firm for businesses and individuals, knows exactly how to decide where to put your money safely.
An acclaimed expert in finance and investment, he manages $300 million of resources for 52 companies.
Alcala also works with Nefincol SAS, which is a company that offers fast liquidity solutions to small and medium-sized businesses through factoring and other financial products as its main focus.
He has enabled capital expansion of up to $30 million for businesses in three years.
Alcala says there is a tried and tested way to reduce the risk factor on investment: “You have to understand your situation – not everyone has the same solution.
“While this is not the perfect time for investment, it doesn’t mean you can’t. Just be sensible. Only invest in shares if they are safe. Invest in companies with strong financial structures and a clear business plan.”
When it comes to “safe” shares, Alcala says there are two options depending on what type of investor you are: “If you are in the stock market, make sure it is Standard & Poors 500. If you are a professional investor, you can invest in specific shares,” he says.
The S&P 500 index is Fortune Magazine’s annual ranking of the United States 500 largest corporations, ranked by revenue.
Companies have to make $49.7 million in revenue to make the list. General Motors (GM) had $9.8 billion in revenues in 1955, making it the top company on the Fortune 500 list.
Alcala adds: “If you are not a professional investor, S&P 500 companies should be the best option for you to consider. You don’t get rich in one night but you have the best position when the market is going down.”
One of the best ways to gauge prominent American equities’ performance, and the overall stock market, is the S&P 500 index. With an emphasis on market capitalization, it features 500 major U.S. companies.
While you can’t directly invest in the S&P 500 because it’s an index, you can invest in one of the many funds that use it as a benchmark, tracking its composition and performance.
Alcala knows the language of investment. His career spans nearly 30 years in credit and risk, as well as Vice President for Bancolombia and Banistmo.
Now he speaks to banks on behalf of businesses to secure investment through his exemplary skills.
Alcala also advises at the Universidad Del Norte, where he evaluates and judges the projects of students studying financial derivatives.
Mario says caution is key right now: “This is not a perfect time for investment. If you can hang on for the next six months, we will start seeing shifts in the market. It’s better to be relaxing in the investment activities.”
He also has some wise words on Bitcoin: “Bitcoin is only for professional investors. If you don’t understand it, don’t invest in it.
“Yes, it has dramatically fallen in value in recent months. But I think it will come back because the markets always have this behavior. The main issue with Bitcoin is it’s like the wild west out there. At this time, there is little or no control. So it’s wiser to steer clear.”
Enrique Ariza works alongside Alcala as a director at Socius. He says Mario is like a “father figure” who offers expert guidance and support: “Mario has a unique and skilled ability in finances and has enabled businesses to ride through difficult times.
“He has a genuine and deep understanding of how markets work. His skill set is very difficult to find at this high level of finance. Mario has enabled businesses we have worked with to expand exponentially and save themselves from going bankrupt.”
Enrique adds: “He has a passion and commitment to finances and building wealth for businesses, which he can do through very specific techniques. Undoubtedly, he has been a mentor to not only myself but many of the business owners we have worked with.”