I’ve touted the importance of diversification here in many posts over the past few years. While it may seem like diversification is the cure-all for any portfolio, I should remind you that regardless of whether you diversify or not, investing is still a risky endeavor that way more often than not involves a lot of luck. That’s not to say you still can research a stock or company you invest in and do your homework–that helps immensely to determine strong performing stocks and to avoid ones that tend to be more volatile. However, no matter how the stock has performed Continue reading Investing is Based on Luck; Diversification Helps
Diversification is important to your portfolio. It spreads your risk around and prevents a market downturn from completely decimating your portfolio by ensuring that all your money isn’t tied up in one sector or one type of stock. Remember, some areas of the markets will get hit harder than others. I’ve mentioned various ways to diversify–such as investing in unrelated market sectors, investing in companies of various sizes, having different investment vehicles. What I haven’t really talked about is going international as part of your diversification. Having some investments in international companies–or companies based outside the U.S. and Canada–can be Continue reading Giving Your Portfolio International Flair
It’s been a while since I last harped on the importance of diversification and making sure that you are spreading the risk around in your investment portfolio. Now that we are into the new year–and a new decade–now might be a good time to talk about it again. Diversification means investing in various stocks and market sectors so that you are not just putting all your risk on one place. By spreading the risk around, your portfolio won’t be as hard hit by market swings. For example, if you have some of your portfolio invested in the tech sector, for Continue reading Diversification For the New Year!
I’ve talked about diversification quite often in blog posts over the years. Most of that diversification talk has centered around investing in different types of investments, such as having a mix of stocks and bonds or investing in different market sectors. However, today I want to talk about diversifying the places where you actually put your money. You’re probably well aware that there limitations on how much you can contribute to an IRA or 401(k). So, what do you do if you have extra money? Well, you could put the money in a savings account or another IRA, or you Continue reading Diversify for Retirement With a Brokerage Account
I’ve said it here before and you’ve probably heard it thousands of times from other sources, the stock market is unpredictable. No, you can’t beat it or think you can outsmart it. So, what’s the best way to deal with it if you are using it to help build up your nest egg or fund your retirement? Ignore it! I know that might be hard to do, but it’s the only way you’ll stay sane. That’s especially true during economic periods like what we are going through right now. At the moment, it’s hard to tell what exactly the markets Continue reading Want Peace In Retirement? Ignore the Markets!
Many Americans use the stock market–and other investment markets–as a way to build up their nest eggs over the long-term. After all, well thought-out investments in steady, low-risk annuities or mutual funds can produce quite a return over a long period of time, such as multiple decades. However, not all Americans have the discipline and patience to make such long-term investments. It’s not uncommon for some to attempt to outsmart the markets by either trying to predict what an investment will do next or by making risky investments that they hope will payoff in the short-term. This rarely, if ever, Continue reading Outsmart the Markets? You’ll Just Look Dumb
It’s been over a decade since the stock market hit the lowest point of the recession in 2009. Since then, it’s done nothing but seemingly improve. After a decade of seemingly (key word here) bullish activity, one would think that a lot of investment portfolios and retirement accounts would be reaping the benefits, but that’s not necessarily true. In fact, the majority of Americans will still struggle to save enough for retirement. The biggest reason? The majority of stocks are still owned by the richest few Americans. While many Americans were able to bolster their nest eggs by investing during Continue reading A Bullish Stock Market Doesn’t Equal Retirement Riches
Investing can get complex quickly. It can be easy to overthink your investments and strategies, which can lead to confusion and just plain bad decision-making. While the pundits and talking heads may throw out random predictions and complex investing terms, but that doesn’t mean you need to get overly complicated with your portfolio. In fact, it’s best to keep your investing simple. That means taking on less risk, increasing your savings rates, and giving focusing on investments that are better geared to weather market ups and downs. What you want to avoid are complex strategies that may require you to Continue reading Keep Your Investment Strategy Simple!
If you are more than 10 years away from retirement, then you probably aren’t thinking about the few years immediately before and after you retire. If anything, you’re probably most focused on whether you have enough saved at this point and when you might actually want to retire. As you move closer to retirement, you should pay attention to the five years before and the five years after you retire as that is the period of time that sets the tone for your retirement. It’s also a period of time during which your nest egg is most vulnerable. This is Continue reading Preparing for the Risky Retirement Period
When it comes to investing and markets, the terms “growth” and “value” get used a lot. Often times, those terms find themselves in competing philosophies with investing experts and talking heads discussing which is better, value investing or growth investing. For some investors, it’s all about growth; how much more valuable can an investment get? For others, value takes the cake. For value investors, it’s about how an investment will perform over time and whether it’s worth that initial cost. Now, there are risks and benefits to both types of investment approaches. Growth investments can help to build up your Continue reading Growth Vs. Value