Archive for February, 2009
Protected: How to Manage the Risk of “Portfolio Risk”
There is no excerpt because this is a protected post.
OOPS: Investors Mistake Brokers for Advisors
According to a survey conducted from April 12 -16, 2007, the average pre-retiree could not distinguish between a stockbroker and a registered investment advisor in order to determine who they should be listening to for retirement planning.
Conservative Risk Tolerance is Low
Conservative Investors have a Low Risk Tolerance
The heart of conservative investing lies in the low tolerance for risk. Conservative investors generally express that thinking through action when they weight their portfolios heavily in bonds and large cap domestic stocks.
Inside “Buy-Side” Intelligence
Like any street, Wall Street has two sides. If retail investors are on the sell side (sold at the offer) then large institutions are on the buy side (bought at the bid.) For them, stock is an investment that must achieve certain returns in the face of various macroeconomic factors.
Index Investing Means Low Fees
Low Fees and Index Returns Attract ETF Investors
Index investing allows investors to put their money to work with some of the lowest costs in the industry. If low fees for financial services concern you the most, this may be the starting point for your future planning.
New investment products in the last decade allow individuals with relatively smaller portfolios to use ETF’s in order to gain out-sized diversification in a variety of indices. The financial press has widely publicized that typical management fees for index funds are under 20 bips (0.2 percent) which makes them some of the lowest fee choices available. The popular thinking equates greater returns on investment with lowered fees for services.
Index Investing Advantages
Using index funds like ETF’s allows for a stringent design of diversification. The investment policy statement of the funds demands that all of the equities in the particular index must be held without regard to valuation or any performance prediction.
5 Fundamentals for Success
These times demand that you manage your money with sound fundamentals in mind. Most people think that investing is about buying stocks and watching the price of their assets go up from the moment they buy. That’s for amateurs and gamblers.
Low Costs Guide Investment Choices
Lower Fees Contribute to Returns
In both bull and bear markets, popular media advise strongly that lower fees guarantee a larger return. After all, if you avoid a 1% fee, then you have 1% more money for yourself. John Bogle, founder of Vanguard funds, advocates that individual investors pare away most all fees and “take what the market gives them.”
Missing Out on Your Share of Huge Profits?
In short, the purpose of prudent investing is to make sure that you are able to benefit from the earnings of as many good companies around the world as possible. It’s true that many of the strongest and most sustainable ones are here in the US, but there are some great candidates in other countries.
On Target Portfolio Management
Portfolio management serves two purposes; a manager or advisor needs to control risk and work to capture returns. An expert prudently diversifies the portfolio to protect against systematic risk.
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