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2020 2nd Edition (Other Editions)

How to survive in another financial crisis?

The recent outbreak of the coronavirus has led to huge fluctuations in the financial market. It’s always safe to plan ahead in case of an economic downturn and volatility in the market.

To manage undesirable risks, geographical diversification can be a solution. As cliche as it sounds, NEVER put all the eggs into one basket. Investing in oversea markets instead of pouring all the money in Hong Kong stocks can reduce the loss incurred from the market collapse in one single location. Besides, portfolio diversification is also a wise way to lower the risk. Allocating your money into various financial assets such as bonds and commodities instead of solely investing in stocks can make your portfolio less volatile and thus generate a more stable return. What's more, there are some other ways to help you secure your return. Just like rebalancing, which means selling a proportion of the stock when the stock performs well. This can ensure profit-taking and avoid an immense loss caused by a sudden plummet after the stock price hits a new peak.

Managing your assets can be challenging. However, a financial coach can guide you to make informed financial decisions and construct a portfolio according to your own risk aversion and return preferences.