| |
| |
|
Investing Information |
|
|
|
Investing and Asset Allocation
Sometimes you spend sleepless nights worrying about which stocks to buy and which to sell, which funds to own and which to dump and whether to get into bonds. All of these are legitimate concerns, but the greatest determinant of your success as an investor will not be your sagacity in selecting specific stocks, bonds or funds for your portfolio. No, it will be your asset allocation. That is, the way you slice up your portfolio into broad categories of, say, large-cap growth stocks and value stocks and triple A bonds and so on. There are many opportunities available to today's investor. Taking advantage of these opportunities by strategically distributing your money in a number of different instruments can protect your portfolio and improve your chances of achieving a desired return. It is important for investors to understand that diversification in building a balanced portfolio helps reduce risk and improve returns. Asset allocation is yet another way to diversify. It takes advantage of the fact that when it comes to risk and reward, financial categories like stocks, bonds and money-market (cash equivalent) accounts all behave quite differently! Stocks, for instance, offer the highest returns among those three "asset classes," but they also carry the highest risk of losses. Bonds aren't so lucrative, but they offer a lot more stability than stocks. Money-market returns are puny, but you'll never lose your initial investment. An asset-allocation strategy looks at your particular goals and circumstances and determines what asset mix gives you the optimal blend of risk and reward. Asset allocation is a process that you re-visit again and again as you continue to build your portfolio throughout your life. Learn to identify the events that can indicate a period of re-evaluation of your asset allocation! Chances are that, over time, the value of your investments in stocks will grow more quickly than that of your investments in bonds and cash equivalents. Eventually you will likely have a larger percentage of your money invested in stocks than your original strategy recommended. When this situation occurs, your portfolio could be exposed to more risk. To help ensure that your assets are invested appropriately, periodically rebalance your investments! Ioannis Evangelos (Akis) Haramis Ioannis Evangelos (Akis) Haramis was born in Athens, Greece in 1951. He studied in Greece, in USA and in Belgium and has been active in the stock markets since 1972. Since 2002 he is New Business Development Managing Director at an Investment Bank and the publisher of http://www.GreekShares.com
MORE RESOURCES:
Google News |
|
|
|
RELATED ARTICLES
Playing With Money - And Making More Ready to start playing with your money? Not interested in complicated businesses or boring bank C.D. Volatile Oil The Light Crude Continuous Contract fell from $67.70 a barrel on Monday to $62. Investing In Sons Business Could Cause A Real Family Feud Q: My youngest son wants to borrow $5,000 to start his own business. My wife is afraid to tell him no. Real Estate Clubs Hot Among Investors Six or seven years ago, the stock market was booming, Internet companies that no one had ever heard of were valued at billions of dollars, and anyone and everyone was investing their money in tech stocks. Then, in 2000, the stock market crashed, the Internet companies closed their doors, investors lost trillions of dollars, and life went back to normal, more or less. Oil and Gasoline Price Uncertainties The Light Crude Continuous Contract hit an all-time high at $70.85 a barrel, while Unleaded Gasoline Futures spiked 50% or $1 a gallon on Tuesday. College Savings Plans - Are They The Best Choice For My Child? College Savings Plans - are they the best choice for my child?College Savings Plans, also called Section 529 plans, are one of the best ways to save for college because they offer:- Tax advantages- A variety of investment options- Flexible contribution options- Parental control- Little impact on eligibility for need-based financial aidTax advantagesInvestments in 529 plans are usually exempt from federal taxes. Earnings are tax-deferred and are not subject to capital gains taxes. An Introduction to Offshore Investing Once upon a time, offshore investment strategies were spoken of in hushed tones. They were conversations restricted to the plush offices of private Swiss bankers, or a dinner table topic in the expensive playgrounds of the multi-millionaires. Expand Your Pool of Investors for Your Company If you own a company that sells complicated products and you want more investors, consider having topics on your web site that discuss the background needed to understand your products and your company. For example, if your company specializes in producing and researching monoclonal antibodies, post articles discussing exactly what monoclonal antibodies are, how they are produced and what research your company is engaged in. Investing: Do You Want To Make Money, Or Would You Rather Fool Around? It always amazes me how much stock market investors resemble horse track bettors. Some are very conservative, willing to trade low returns for relative safety. Volatile Range The stock market fell sharply Thu and Fri before and after the employment reports Fri morning. The Nonfarm Payrolls report showed 207,000 net jobs were added in July, which were 27,000 more than the market expected. A Gadfly On A Dinosaurs Butt, Or The Hood-winking Of The American Investor Have you ever noticed how some words in the English language are so perfectly named for what they describe? And how some words seem to be, I guess you could say, backwards? For instance, the word sunflower! How wonderfully aptly named is the sunflower, that beautiful yellow flower that follows the sun from sunrise to sunset.And then there are those words in the English language where there meaning appears to be backward, so to speak - like parkway and driveway. Success Trading: Some Basic Terminology for New Traders The world of trading can get very complex because the financial markets are complex. There thousands and thousands of successful traders out there today. Sitcom Investing A fickle stock market encourages good-humored mockery.Recently, as I watched the premiere of a sitcom, an obvious omission breached television etiquette. Use of a Franchise Business as a Family Tax Planning Strategy Suggesting the use of a franchise business as a vehicle for family estate and tax planning. Specifically using as an example, The Car Wash Guys, a portable car wash franchise, where you will be purchasing a completely designed and outfitted car wash truck and the right to develop a specific city or regional area with out of pocket start-up costs between $25-50,000. Is Starting A Business For Me? What To Consider Before Starting A Business Do you have the right temperament?Starting a small business is one of the most serious decisions that a person can take in life. Positively, it often results in higher income levels than one could achieve as an employee together with the unique buzz of being your own boss but conversely it also can be stressful, will demand longer working hours and will probably reduce your ability to take long holidays. What Is A Fair Market Value, Really? If Youre Going To Trade, Be Sure Its Worth It! I've been involved in online trading, specifically with stock and index options, for several years. In this time, I've spent a great deal of time thinking about value and the fact that anything, be it a stock or currency or even a house, is worth exactly whatever someone else will pay for it. POOF goes your RRIF ! Some time ago I attended a seminar where participants were told to burn some money; a reasonably-sized amount of money. You should have heard the gnawing and gnashing of teeth in that room! Step right up, folks, and light it on fire. Finding a Broker "Hey Joe! I need help finding a broker. I notice that discount commission rates are pretty much the same. 5 Ways To Protect Your Bond Portfolio From Rising Interest Rates The Federal Reserve recently raised its target federal funds rate for the first time since March 2000. This could be just the tip of the iceberg, though, as many experts believe rising inflation and a strengthening economy will spur continued rate hikes for the foreseeable future. Forex market offers opportunity and information The forex market is what is called an international exchange currency market, where currencies are exchanged on a daily basis. There are five forex market centers around the world - New York, London, Tokyo, Frankfurt and Zurich.
|
