World Investor Week, an initiative from the International Organisation of Securities Commissions (IOSCO) will be running from 2-8 October and has been designed to promote investor education around risk.
“Smart investors don't rely on good luck; they plan, research and understand their investments and how they fit with their financial goals,” said ASIC deputy chairman, Peter Kell.
“With only 39 per cent of Australians reporting that they understand the investing principle of ‘diversification’ it's important that people are clear about why they're investing and only invest in products they understand,” he continued.
ASIC and World Investor Week highlighted 10 “golden rules” for investors.
According to ASIC, investors should:
1. Make sure their investment needs and goals are in line with their plans;
2. Consider the volume of risk they want to take on and understand how risky their investments are;
3. Refer to ASIC to see if the scheme or company has actually been licensed;
4. Research the way their money will be invested by the company;
5. Read the scheme or company’s product disclosure statement;
6. Diversify between assets to “spread” their risk;
7. Avoid “get rich quick schemes” and be aware of the signs of a scam.
World Investor Week added that smart investors should also:
8. Assess the impact of fees when considering an investment;
9. Recognise the power of compound interest;
10. Understand that risk is inherent in “all investments”.
World Investor Week has been endorsed by the G20 Germany 2017, the World Bank Group and the Organisation for Economic Co-operation and Development (OECD) among others. More than 70 countries have signed on to participate in the week.