Investing for the long term The three pillars of investment success

Three factors are crucial if you want to invest successfully: analysis, strategy and discipline.

by Stephan Lehmann-Maldonado 20 Jan 2016

“This is a secure investment that pays out fantastic returns”: promises of this kind should set all your alarm bells ringing. Because there is no such thing as return without risk on the financial markets – and no guaranteed recipes for success. Even the most astute investment experts cannot predict the movements of the stock markets with any certainty. However, countless studies show that long-term investment success is based on three factors: analysis, strategy and discipline.
Analysis means systematically studying the markets and investments worldwide in relation to both risks and return potential.

The investment strategy determines how the assets are allocated in a broadly diversified manner across various asset classes – such as equities and bonds – and markets. It has to be tailored to the individual risk profile and needs of the investor.

Discipline is perhaps the most important factor. Once the investment strategy has been chosen, you should stick to it. Even when the stock markets are experiencing turbulence. In other words, you should regularly review your portfolio and re-balance it to match your strategy.

Get professional help

Most private investors experience difficulty in tackling all these requirements – or even just finding the time to do so. That’s why a ready-made solution can be suitable. UBS Strategy Funds are one such example. Here, the professionals take comprehensive care of all three aspects – analysis, investment strategy and discipline – and ensure that no risks creep into your portfolio that you are not willing to take on.

The systematic way to find the right investment

There are a vast number of investment opportunities on the market. Follow the step-by-step process to find out which are a good fit for you.

  1. What are your financial goals?
  2. What does your overall financial situation look like at present?
  3. What risk type are you?
  4. How long do you want to invest your money for? 
  5. What investment strategy is right for you? 
  6. To what extent should your bank be involved? 

Experience shows it can make sense to discuss these questions with an expert.