Having an "Opportunity" Fund

Having and Opportunity Fund is overlooked by many investors, including savvy investors who have been in the investing world for many years.

So what is an Opportunity Fund? Basically, it is a sum of liquid assets, usually cash or saving deposits. At this time where there is a "fire sale" on the stock market where stocks, especially blue chips are at their lowest (usually 52 weeks lowest), an available pool of cash to take advantage of the low price would position investors to benefit when the economy recovers and looking back at history, we know that the economy will always recover. It's recovery is only a matter of time.

For most investors, this fund should not be similar to the emergency fund that you read about in most financial planning books or newspaper articles. This emergency fund as read should be equivalent to 6-12 mths of monthly expenses,(depending on how risk-averse you are). Once this fund has been set aside, you should then start setting aside another sum for your Opportunity Fund.

Economic or financial crises are part and parcel of life so we might as well prepare ourselves to take advantage of it. For those that are just starting out, it would be better to learn more about the available investment tools.

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