Diversification Investing for the Financially Challenged Tips on Index Funds
Invest in the # 2 Mutual fund best. check performance over 3,5,10 yrs fund vs. group; top 10% and top 10 index funds. low expenses less than 1% management fees. avoid lousy performers.
allow advantage of the whole investment market: real estate, stocks, bonds, treasuries, mutual funds, and if adventurous, options. build a portfolio of securities from different asset classes. Bonds tend to do well when stocks don't. Treasuries are the securest investment around. The low-risk side should balance the high-risk side.
take advantage of a broad range of companies and industries available. Instead of being a niche investor who only invests in high-tech stocks, for instance, buy securities in the same asset class that are not affected by the same variables. Entertainment companies, utilities, grocery stores, and airlines, for example, are completely different businesses.
can be found even when investing in a small handful of companies; diversity is found by owning companies with diverse product lines. For instance, Proctor & Gamble is usually thought of as a household products manufacturer, but its product lines include health care, paper, beauty, cleaning products, and food.
A small - cap U.S. stock fund should be the anchor to your mutual fund portfolio.
Hold a variety of funds to protect against changes in the market, Blue chip funds have been very popular in recent years but when the bull market finally ends, big companies with high P/E multiples may become less and less attractive.
Don't worry too much about overlaps in holdings among your mutual funds. Fund managers may own some of the same stocks but they buy and sell at different times and in different quantities.
Make investing part of your monthly money moves.
allow advantage of the whole investment market: real estate, stocks, bonds, treasuries, mutual funds, and if adventurous, options. build a portfolio of securities from different asset classes. Bonds tend to do well when stocks don't. Treasuries are the securest investment around. The low-risk side should balance the high-risk side.
take advantage of a broad range of companies and industries available. Instead of being a niche investor who only invests in high-tech stocks, for instance, buy securities in the same asset class that are not affected by the same variables. Entertainment companies, utilities, grocery stores, and airlines, for example, are completely different businesses.
can be found even when investing in a small handful of companies; diversity is found by owning companies with diverse product lines. For instance, Proctor & Gamble is usually thought of as a household products manufacturer, but its product lines include health care, paper, beauty, cleaning products, and food.
A small - cap U.S. stock fund should be the anchor to your mutual fund portfolio.
Hold a variety of funds to protect against changes in the market, Blue chip funds have been very popular in recent years but when the bull market finally ends, big companies with high P/E multiples may become less and less attractive.
Don't worry too much about overlaps in holdings among your mutual funds. Fund managers may own some of the same stocks but they buy and sell at different times and in different quantities.
Make investing part of your monthly money moves.
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