Philippine stock market board (Photo credit: Wikipedia)

The American stock market index, as will all such markets around the world, is subject to ups and downs on a daily basis that are caused by numerous factors. For example, who could have predicted the 9/11 terrorists attacks, which had a huge negative impact on world stock markets? When Lehman Brothers, a major American investment bank, collapsed in 2008, the value of all stocks and company shares in the USA fell dramatically. More recently, the Greek debt situation has had an adverse impact not only in Europe but also on the American stock market, as has the political unrest in Syria.

The following graph gives an illustration of investing a dollar in different asset classes in the market from 1926 to the end of 2007. The returns and dollar value shown represent past performance only and does not guarantee future results. The red arrow at the bottom indicates when 9-11 occurred. (Photo credit: Wikipedia)

1. Understand What Type Of Investor You Are

A key principle is to understand what type of investor you are. There are either active or passive investors. To be an active investor one must be committed to doing the necessary research in order to generate a good return. They also must learn to manage risk wisely. A passive investor does not have the amount of time it takes to properly research and diversify investments. This type of investor is better off investing in a whole index fund where they can achieve diversity and get the return of the whole index. Another option is to let a professional handle his investments if they do to have the time to devote to it.

Webvan (Photo credit: Wikipedia)

A few things were never intended to be, yet that does not imply that buyers won't stack millions of pounds on a bad idea - or perhaps a great idea that went bad. Whether or not they slumped and ripped or pulled investors dry, these investment strategies simply failed to work.

Amp'd Mobile: Amp'd Cell stands top for cash burning, with $360 million being ended up in bankruptcy. Their main concern was its clients' capability to invest.  Whilst various other cellular companies verify for a capability to pay expenses in a month time, the company allow it until 3 months and promoted to those risky clients. It has been noted that 80,000 of its 175,000 clients were not able to pay their expenses.

Procket: This was one of the highly valued telecom companies in the U.S. The company had $272 million in capital along with a worth of $1.55 billion however was eventually bought by behemoth Cisco Systems Inc. for a deflating $89 million.

Webvan: Webvan had been a grocery delivery company which served 9 metro cities. However, in 2001, the business went bankrupt once it made plans to expand to 26 more cities with $1.2 billion budget. Regardless of millions in product sales, their collapse was due to a money-burn which surpassed product sales development.  Significant buys included $1 billion for manufacturing facilities, business servers and much more than one hundred Aeron chairs.

Image by Renegade98 via Flickr

Years ago, women depended on their husbands to bring home the money, invest it, take care of it and save it. Times have changed, thank God, and women are controlling their own finances and investments with the money that they make. Women are choosing what to do with their money and how to protect their futures, their families and their careers.