4 Ways To Double Your Money
Have you ever wondered how long it would take you to double your money in the stock market? Or wondered what types of strategies you need to implement in order to double your money in the markets? If so, this blog post lays out 4 ways that you can double your money.
Method #1: Invest in Quality Blue Chip Stocks and Hold Them For Many Years
The first way that you can double your money in the markets is to invest in non-speculative blue-chip stocks that are fairly priced and that represent good value, and also by investing in investment grade bonds.
Over the last 100 years non-speculative blue chip stocks have averaged a return of approximately 10%, and investment grade bonds have averaged approximately 6% return. The Rule of 72 is an investment principle that shows you how long it will take for you to double your money. So based on the Rule of 72, it would take you about 9 years to double your money if you were able to achieve an 8% rate of return on your money. This is the "steady as she goes" method to building wealth, and is a reliable way to build wealth over time.
Method #2: The Contrarian Way
The second way to double your money in the market is to be a contrarian investor. In order to make money as a contrarian investor you would be required to have the fortitude to dive into the markets when others are selling stocks rapidly, and are potentially bailing out of the markets. If you adopted this contrarian investment style back in 2008 and 2009, during one of the worst bear markets in recent history, you would have been handsomely rewarded.
As a contrarian investor you can definitely double you money in the markets, and can make a lot of money. However, there is also the possibility that you lose money, so tread lightly, and conduct a tonne of research before buying a contrarian investment.
Method 3: The Speculative Way
This method of doubling your money requires you to invest in more risky investments such as bitcoin, penny stocks, or even the options market. As it relates to the options market, the most speculative investment would entail you borrowing money to buy call options (also called leveraged investing or buying on margin).
This is one method that you should steer clear of if you are a new investor, and even if you are seasoned investor who does not feel comfortable with leveraged investing, or speculative investing. One recent example of how risky call options can be occurred when a number of hedge fund managers bet against Tesla, and were subsequently short squeezed when the stock started to go up, versus going down. What that meant was that they hedge funds had to settle their positions at a loss!
Method 4: Mergers Arbitrage
This is one of my favourite ways to double my money. Mergers arbitrage is when you position yourself in a company that is in the process of being sold, or potentially being sold. You need to conduct thorough research to determine if and when the company that you are interested in will get sold. This is a wonderful way to double your money in the markets, however, as noted previously, make sure to do a lot of research to determine the likelihood of the company in question being taken over.
There are absolutely no guarantees that even after you have conducted thorough research, and completed your due diligence that the company you have purchased will be acquired. Nonetheless, if the company is acquired, what often happens is the company's stock price will go up exponentially on the day of the announcement, and you will be rewarded for your thorough due diligence. This is a powerful way for you to double your money!!
As you can see, there are a few ways for you to double your money in the markets, and based on my experience, the slow and steady method of acquiring blue chip stocks and investment grade bonds takes center stage, and, Mergers Arbitrage comes in second, when it comes to doubling your money in the markets. I have been successful with both these methods, and would suggest that you look into these methods to build your wealth!
If you haven't already picked up a copy of my book "7 Steps to Get Out of Debt and Build Wealth", just simply go here, and select the retailer of your choice! My book is available at Amazon, Barnes and Noble, Indigo, and Books-A-Million. Alternatively, you can buy it directly from me through this link here. If you're ready to kick-start your finances, and take your financial game to the next level, then this book is for YOU!
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