Some strategies for maximizing profit and minimizing risk.
Seniors who are living off all or a part of their retirement savings should be keenly interested in current income and safety of principal. The amount of risk that one is willing to take to generate greater returns in one’s portfolio should based on one’s specific time horizon and the amount of dollars that will be withdrawn each year from the fund to support one’s lifestyle. In my case, I have segmented my retirement assets into two buckets: conservative and more aggressive. I will withdraw monies from my conservative bucket first, thereby providing more time for the more aggressive segment to, hopefully, grow at a rate commensurate with my risk. Those facts notwithstanding, if sufficient income can be generated with low risk …
Asset allocation, portfolio diversification and periodic rebalancing of your investment portfolio will enable your investment strategy to better meet your objectives
The old bromide reads "Don't put all your eggs in one basket.” The same advice applies to your investment portfolio. Don't put all your money in one fund, one stock, one mutual fund, or whatever. If the bottom drops out (as it just about did), you could suffer huge losses in your retirement nest egg if your investments are concentrated in one or two financial instruments. When it comes to investing, three time-honored tenets will help you divide your savings among different investments: asset allocation, investment diversification and portfolio rebalancing. If you remember these three principles, they will help you tailor your investment portfolio to fit your life situation and your investment goals. Almost every investment can perform …
Mike Dever
12:58 pm on Tuesday, September 11, 2012
Diversification is the one true "Free Lunch" of investing. But if a person starts with just considering long stocks, bonds, commodities and real estate as being the only portfolio options, then true diversification cannot be achieved. That is because conventional portfolio diversification is constrained by the use of "Asset Classes." I discuss this throughout my book, which is the #1 best-selling… more ›