Some of the important Investment Strategies are:

• Harness the power of compounding: This is the first most important principle of financial planning. Investor should learn to invest for long term and reap the benefit of compounding. The more the benefit of compounding the greater will be the growth in capital.
• Buy and hold strategy: This is a common strategy used by people. However, it should be exercised with care. The rule is to hold an investment until it meets the investment objective. Investors are advised not to fall in love with their investments.
• Rupee cost averaging: Financial planning calls for discipline and investment should be made regularly. A regular investment strategy brings down the average cost on investment.
• Value cost averaging: In value cost averaging, the investor fixes a ‘target value' for his investment. He then reviews his balance periodically and maintains it equal to the target value by withdrawing or investing money, as required. In this strategy, he automatically invests when the prices are lower and sells when the prices are high.
• Jacob's combined approach: Jacob recommended a combination of both rupee cost averaging and value cost averaging. In this approach, the investor uses both equity investment and liquid investment. If the value of the equity investment declines, then transfer money from the liquid investment to the equity investment. If the value of the equity investment appreciates, then transfer money from equity investment to the liquid investment.
• Start saving early and save regularly: Many young people, despite earning well, do not seem to pay much attention to savings and investments. They perhaps believe that they have a long productive career ahead of them and they need not worry about saving and investing at an early age. They probably don't fully realize the benefit of growth over time. To tap this benefit, you should start investing early and regularly over a long period.
• Maintain adequate emergency fund and an appropriate insurance cover: Life is uncertain and almost everyone experiences unexpected financial needs. To cope with the catastrophes of life, one needs an adequate emergency fund and an appropriate insurance cover.
• Diversify adequately: One's investment strategy should be to diversify one's holdings among different asset classes. It is advisable to further diversify within those asset classes also. Due care should be taken that the portfolio should neither be under-diversified, nor over-diversified.
• Periodically review and revise portfolio:Often, investors do not review and revise their portfolios regularly. Subsequently, it may result in poor returns as compared to the expected ones.
• Prefer growth over tax saving:Government norms on tax breaks are dynamic across the globe. Therefore, one should not consider tax saving as the ultimate financial goal. Instead, the focus should be on the absolute return on investment.