Posted by Diane H. Blackwelder, CFP® on 21 May 2010 | 0 Comments
Tags:
investing,
financial tips
Raise your right hand and repeat after me. "An Investor's Manifesto":
Source:
Kiplinger By Knight Kiplinger June 2009
I am an investor. I do not trade my assets frequently. That's speculation, not investing.
I am also a saver, fueling my investments with continuous savings from current income.
I know that every kind of asset entails risk -- even cash, which can be eroded by inflation.
I know that higher returns entail higher risk, in every kind of asset.
I accept those risks, but I mitigate them by owning a diversity of assets.
I regard my home as a place to live, not as an investment. It is not a substitute for retirement savings.
I have an investment plan and a plan for asset allocation, in consultation with a financial adviser.
I invest regular amounts every month, in both rising and falling markets. I know I can not gauge market tops and bottoms. If I receive a windfall -- a bonus, bequest or gift -- I gradually feed it into my regular investment mix.
I don't pour more money into hot markets nor completely cash out of plunging markets.
I spread my investments among several asset classes, in a mix fitting my age and risk tolerance.
I rebalance my portfolio every quarter. If the stock market plunges, pushing my stock allocation way below its target percentage, I sell bonds and use my cash to buy stocks.
I force myself to sell high and buy low by periodic rebalancing-just what is temperamentally difficult for most investors to do.
I know that stocks are risky in the short run, so I hold in equities no money for which I have a likely need in the next three years.
But stocks are not too risky in the long run. They have outperformed all other commonly traded assets over periods of 15 years and longer.
Foreign stocks account for at least 15% of my stock allocation. I believe that developing economies will enjoy much higher growth than the U.S. in the decades ahead.
I never borrow against my stocks. Margin calls could force me to sell good assets at a bad time.
I stick with my game plan. I do not check the value of my investments every day or even every week.
I try to keep my cool when other folks are losing theirs.
I remind myself often: I am an investor.
| Read the full post
Posted by Myles Brandt, CFP® on 18 March 2010 | 0 Comments
Tags:
Investing,
Market Risk
Maria Sharapova went into the semifinals of the LA Women's Tennis Championship in 2009 clearly favored to win. Yet, she was beaten by the 10th seeded Flavia Pennetta from Italy. Critics said it was her serve and the recent shoulder surgery. What I noticed during the match was that Sharapova had 61 unforced errors and Pennetta had 23. Unforced errors are mistakes that are supposedly not forced by your opponent. They are mistakes that could have been avoided. Pennetta won not because she played well, but because Sharapova played badly.
| Read the full post
Posted by Myles B. Brandt on 14 July 2009 | 0 Comments
Tags:
Behavior,
Investing
Over the long run, equity mutual funds can offer some pretty attractive returns. Ibbotson SBBI research shows that Large Stocks have returned an annualized 9.6% from 1926 to 2008. All too often an otherwise rational person will have an investment experience that doesn’t measure up to market returns. Studies suggest that investors actually under-perform the funds they are investing in. How could that be?
| Read the full post
Posted by Bill Prewitt, M.S., CFP® on 12 June 2009 | 0 Comments
Tags:
Active Investing
Is this a time when active investing can add value? With all the market volatility, it would seem that nimble investors could beat the crowd. Find out by following the link below. It is an interview with Ken French, Professor of Finance at Dartmouth College. http://www.dimensional.com/famafrench/2009/06/is-this-a-good-time-for-active-investing.html#more
| Read the full post
