Shoppers Cradle

Whatever the mind can conceive and believe, the mind can achieve. Success comes to those who develop a success consciousness. Wishing for success is not enough...

Benefits of a Well-Diversified Investments

1. Risk Reduction. You can't eliminate risk completely, but you can manage your level of risk. Every investment has some amount of risk. Young investors should embrace risk because the long-term rewards can make it worthwhile. Older investors may view risk as an enemy, because too much risk can annihilate retirement plans. In fact, many senior citizens experienced great losses to their retirement portfolios during the economic downturn.

2. Capital Preservation. Some investors strive for capital appreciation, while some investors use capital preservation as an investment strategy. Capital preservation allows you to protect the capital you have, rather than focusing on the rate of return for your investments. Diversification makes it much easier for an investor to protect their capital, allocating money to different investments.

3. Ability to Hedge Your Portfolio. Diversification can enable a portfolio to grow both when markets boom and returns crumble in one sector. Investors who have had 100% equity portfolios over the past eleven years have likely seen very poor returns. If these investors had diversified their portfolios to include investing in metals, commodities, and bonds, their portfolios would have experienced greater returns. Diversification gives an investor the chance to achieve positive returns in one market when another market is generating negative returns.

https://www.benzinga.com/economics/11/09/1897071/3-advantages-of-diversification-as-part-of-your-investment-strategy

3 Advantages of Diversification as Part of your Investment Strategy Investment strategy matters when it comes to investing in any financial market. If you want to invest, you must deal with the ups and downs of the market. A good week in the...

If you try, only two things can happen, succeed or fail. If you succeed, you do more of it, if you fail you learn from get smarter and try it again.

See? so you won’t lose by taking action, you only lose by not taking ACTION!

INVESTING FOR DUMMIES.

How long does it take to double your money?

The Rule of 72 is a math rule that lets you easily come up with an approximate estimate of how long it will take to double your nest egg for any given rate of return. The Rule of 72 makes a good teaching tool to illustrate the impact of different rates of return, but it makes a poor tool to use in projecting the future value of your savings, particularly as you near retirement. Let's look at how this rule works, and the best way to use it.

For example:
1. If your money is in a savings account earning three percent a year, it will take twenty-four (24) years to double your money (72 / 3 = 24).

2. If your money is in a stock mutual fund that you expect will average eight percent a year, it will take you nine (9) years to double your money (72 / 8 = 9).

https://www.thebalance.com/how-to-use-the-rule-of-72-2388567

How Long to Double Your Money? Use the Rule of 72 The Rule of 72 is a math rule you can use to determine how many years it will take to double your money. Here's how it works.

Tim Olsen bought his first stock when he was 8. His parents set up custodial accounts for both of their children, believing that outside of a savings account, investing in stocks was the best way for their children to start building wealth.

http://money.usnews.com/investing/articles/2016-01-04/how-to-teach-your-teenager-to-invest

How to Teach Your Teenager to Invest Teens have the great advantage of time, but how do you get them interested in investing?

Peso/Dollar-Cost-Averaging (DCA) Principles

By following a simple practice known as dollar cost averaging, you can protect yourself against market fluctuations and downside risk in the market. By buying a fixed dollar amount on a regular schedule, your focus is on accumulating assets on a regular basis, instead of trying to time the market.

Dollar cost averaging is a strategy that is better suited for investors with a lower risk tolerance and a long-term investment horizon. This strategy makes the most sense when used over a long period time with volatile investments, such as stocks, ETFs or mutual funds, and makes less sense for bonds or money market funds.

Next, the strategy is no guarantee of good returns on your investment. Dollar cost averaging into an investment that continues to fall each and every month is not a wise move.

Finally, investing involves risk and your own due diligence, so you should only dollar cost average into an investment that you understand and are comfortable with. You shouldn’t just set up an automatic investment plan and forget about the investment, either – it is probably a good idea to regularly check in on it.

The views and opinions expressed herein

Read more: http://www.nasdaq.com/article/why-dollar-cost-averaging-is-a-smart-investment-strategy-cm354240

Why Dollar Cost Averaging Is A Smart Investment Strategy No one can predict where the market is going at any given time, so why even try? Putting your money in an investment all at once - thinking it will.