Four Sure Signs You Need to Get Out of an Investment Deal Now

Investing is a great way to make a lot of money, even if it comes in at a gradual but steady rate. However, you always need professional help and sometimes you have to swallow your pride and admit that you’ve made a mistake.

Investments go bad, it happens, and the only thing to do is learn how to recognize the signs so you can then save yourself.

Major Mismanagement

Image via Flickr by MyTudut

Who’s managing your investments? Who’s managing the company or brand in which you’ve invested? Even if it looks like your investments are pretty steady, mismanagement means bad business in the long run. Sometimes management changes its way of doing things after you’ve invested, so you have to stay on top of things. If you find that new policies are negatively affecting your stocks or investments, discuss it first with your financial adviser. If it doesn’t look like things
will get better, make the decision to pull out or sell.

Bad Balancing Acts

Image via Flickr by Julia Manzerova

What’s the benchmark on your current investment? If it has historically done well but starts to slip after you’ve invested, you might have a serious problem. Make it your business to do some comparisons and research. Find out how the company balanced in the past, if there were periods of ups and downs, and if the investment has precedence in terms of doing better after a drop. If you fear for your money, think about selling what you have now. Even if things pick up, sometimes you simply have to trust your gut, especially since patterns do often repeat themselves.

Borderline Irrelevance

Image via Flickr by andrevanb

When you invest in a company that specializes in technology or other industries that often see upgrades, you have to keep a close eye on your investments. If you fear that your current investment is lagging behind its competitors, start researching. Take a look at advice from a Fisher Investments Forbes Contributor and similar financial experts. Maybe it’s in your best interest to get rid of your current investments, take your return, and invest in the competitor instead, especially if there’s a competitor that frequently comes out on top.

Debt Debacles

Image via Flickr by Images_of_Money

Do you find that you’re actually going into debt because of your investment? That’s definitely a warning sign. You’re in this to make money, you don’t want to lose anything. Sometimes investing is a gamble, but you still need to know when to walk away from the table. This is another point where you want sound advice. Talk to your investment manager, do research on the investment’s benchmark, and see whether it’s known for its ups and downs. If you suspect that your investment won’t right itself, take action. Pull out and discover how to earn your money back again.

Just because an investment goes bad doesn’t mean you have to completely stop investing. Mistakes just mean you know what to do and what you should avoid the next time you’re ready to invest your money.