Funding the portfolio might remain an overhauling quest for the investors. Well, it needs to have a brain storming session. Stock trading involves larger risk compared to any other alternative of investment. Investing in stock market is a usual craze amid the young people who are immune to risk with less experience and least money in hand. However the traders do believe, “no thorns, no thrones”. A little pain would be able to yield more gain. Here I have a list of alternatives through which you can fund your portfolio. But keep in mind, it is a sensitive matter, do only plunge in if you find yourself enough capable.
- Personal Sources
First evaluate your own sources of funds. How you can find a way to start trading in stock. Do brain storming up to your capacity. Here you can sell your saving bonds, you might have bought sometime earlier in the anticipation of some prize in draw. A little risky, but more likely to be a jackpot if executed properly.
- Salary Loan
If you are a salaried person, you can apply for a medium amounted salary loan. It will have dual benefit for you. If you lose, you will have at least a source to replenish your loss. However loss is loss.
- Check out your belongings
If you do possess any stuff with you which is quite expensive but you can survive without that, go ahead. It can be source of starting. For the beginning you can go for penny stocks which can yield more. For instance you can sell out your rolax wrist watch which you got a present on your last birthday.
- Currency Hedging
Foreign currency hedging can offer you a risk free way to borrow amount. Always remember to hedge in stable currencies for example Euro or Dollar. This technique is however not suitable for the people who are newbie investors because it needs more technical knowledge of market. Secondly, hedging agreements need to have a guarantee that the person is capable to pay the amount back.
- Short selling
Short selling is a way to get indulged in stock trading but this is not considered as a portfolio initiating technique. In the short selling, the mechanism works in such a way that the seller borrows some stocks from a broker on some pre decided price and goes ahead in the market. Be remembered that the price and time duration is fixed. The seller trades in the market. Selection of stocks is an art which you choose for this purpose. Usually investors do not intend to invest in penny stocks because they are riskier. Afterwards, the investors have to return the shares to the broker on the pre agreed price. It is a luck story of the investor that whether he remains successful to read the market correctly or not. This can be a source of funding through capital gain you have earned through short selling. Again this is supportive for experienced investors with strong nerves having potency to bear losses.