Whether you’re a novice investor or experience fellow, identifying quality investment opportunities can be a challenging endeavor. A good number of financial service providers offer big promises to help you find the next hot stock. And everyone has that one overzealous friend who is always pitching the ‘next big thing.’

Despite this, more bluster than brains is behind many of these opportunities. In this article, we take you through some of the things you can do when in dire need of the best investment ideas to leverage.

Build an Emergency Fund

You should always remember that life has a way of throwing curveballs, such as a job loss. Before making investment decisions, it is in your best interest to consider building an emergency fund of roughly six months’ worth of expenses.

Be sure to keep this account separate from your normal investment portfolio. In the event that a rainy day should strike, having an emergency fund with you can help ensure you avoid selling investments at an inappropriate time merely because you are in bind.

Establish an Index Fund

Before taking advantage of individual securities, you should consider making your first investment a low-cost index fund. You might be wondering why this is even essential in the first place. Getting exposed to a wide range of companies, across a variety of industries is as good first step in establishing any portfolio.

Index funds have the potential to help save you time, reduce headaches, and help anchor your portfolio for long-term success. If you prefer having exposure to a given theme, you can invest in exchange-traded funds (ETFs) and mutual funds structured around specific sectors such as technology and even sub-sectors like cloud computing.

There are a plethora of investment opportunities out there worth your attention. However, you need to be sure of your needs and what you deem appealing before making any investment decision.

The catch is in examining the pros and cons of different investment opportunities at your disposal, after which you can choose one based on your needs and preferences.