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Portfolio Management

Investment Strategy

Buy High, Sell Low

It violates the most fundamental element of investing, yet thousands of investors practice it every day. As soon as the market or sector they are investing in loses ground they sell and go looking for the hot market. Eventually a new fund or sector with some strong recent gains is chosen to invest...more

Constructing a Portfolio

No two investors have the exact same investment goals. Building a portfolio that is customized to your comfort level and consistent with your goals can be a very difficult task. Many different factors have to be taken into consideration to assure that your portfolio is well diversified...more

Consider Dollar Cost Averaging

We all know we should buy low and sell high, but determining when that occurs is difficult. Thus, consider using a strategy like dollar cost averaging to help with those decisions. Dollar cost averaging involves investing a set amount of money in the same investment on a periodic basis. For...more

Some General Investing Tips

Realize that saving and investing are two different concepts. Saving involves not spending current income, while investing requires you to take those savings and do something with them to earn a return. Saving often becomes easier when it is separated from the choice of where to invest. Find...more

Watch Out for These Mistakes

Investing is a gradual process - purchasing investments and selling others as the years go by. After a period of years, this can result in a mixture of investments that don't fit your overall investment strategy. Thus, periodically review your portfolio, watching out for these mistakes: You...more

When Selling, Don't Make These Mistakes

An important part of any investment strategy is to develop a methodology for ultimately selling your investments. Unfortunately, many investors sell based on emotional factors, making one of several mistakes: Holding on to an investment with a loss. Psychologically, it's difficult for...more

When Investing, Use Time to Your Advantage

Sports pundits often predict the big winners at the start of a season, only to see their forecasts fade away as their chosen teams lose. Similarly, market timers often try to predict big wins in the investment markets, only to be disappointed by the reality of unexpected turns in performance. While...more

Trading and Investing Are Very Different

Every investor is affected by some degree to trading and the cost of transacting. This refers to trading as a function rather than one's investment strategy. While it is important, if not very helpful, for investors to understand the rules and operational aspects of executing a securities trade,...more

What an Aspiring Buy and Hold Investor Should Consider

The buy-and-hold is said to be the most commonly used investment strategy among individual investors. Many choose this method because of its simplicity & buying a stock and holding onto it, no matter how much the price rises or falls. Buy-and-hold investors usually sell their stocks only when...more

What an Aspiring Day Trader Should Consider

Day-trading, once the exclusive domain of floor traders and of the larger investment firm's proprietary trading desks, is now fair game for all speculators. Inspired in part by instant availability of quotes, affordable high-powered computers and competitive on-line commissions, the new wave of...more

10 Things Every Investor Should Know

I spend a great deal of my time explaining things to my clients as well as many other individuals that do not necessarily revolve directly around specific 'investments'. Over time I have learned that there are a number of issues that individuals should know and understand PRIOR to making investing...more

Investment Approach: Specific Target or Toss the Dart?

If you are like most individual investors, your portfolio is built and designed around a method of pure luck and good intentions. Some investors do not take the time to consider the overall, big goal and as a result the portfolio is constructed to meet the needs or desires of the moment. The...more

Investing Basics

The beginning of a new year is a good time for each of us to review the basics of investing to see if we are adhering to the principles that will make us successful investors over the long run. Compounding to Wealth Most wealth is built steadily over long periods of time. There are exceptions...more

Investments with Eye on Risk Shine

There are three elements that any investment plan must have to succeed: solid performance, low volatility and profit protection. The first point is what most investors want to talk about but the last 2 are where millionaires are made. Countless people have money invested with no 'strategy' for...more

Dollar-cost Averaging: A Simple Strategy for Uncertain Markets

Many people believe that smart investors can 'time' the market'investing on dips and selling at the high points'to make large amounts of money overnight. While this occasionally does happen, it is very rare. Mutual funds offer a simple, convenient, more realistic and less time-consuming method of...more

Five Steps that May Turn the Market's Ups and Downs to Your Advantage

The market goes up, and the markets go down. But what steps can you take when the market becomes more volatile than usual? Should you take all your money out and cut your losses? Or, wait things out? These five steps can help you turn the volatility of the market to your advantage. Step 1:...more

Keeping Your Emotions in Check

The biggest obstacle in making good investment decisions is probably our emotions. Numerous studies over the years have found that investors have certain psychological biases that get in the way of making purely rational decisions. We look for patterns in life, even when they don't exist....more

Wealth Management: Passive vs. Active Investing

In recent years, a variety of investment vehicles have sprung up that allow you to invest "passively" in the market. Instead of trying to beat the market or reduce the risk inherent in it through asset selection, you ride the market for better or worse. You can invest passively through index...more

Watch Out For Those Predictions

Will this year be a good year for financial markets? The answer depends on whom you ask. Every January, I review the predictions of "financial experts" for the preceding year and how they fared on stocks, credit, currency markets, growth and inflation. Once again, only a minority were "right" in...more

Tax-Efficient Investing: A Wise Choice

Taxes can take a chunk out of your investment returns; yet, many investors don't give much thought to taxes when they make investment decisions. While investment decisions shouldn't be based entirely on tax considerations, tax-efficient investing may make a significant difference in your net gain....more

Investing Offensively & Defensively

Have you ever wondered why your investment returns don't match the advertised return of the investment product you are using? Investor return differs from investment return due to the order or sequence of returns on the principal amount, and changes to the contributions or withdrawals over time. ...more

Insatiate Cormorant

In looking back at the recent bull market, it is universally agreed that during those 18 years the market were in a perfect scenario. Low inflation, rise of an investor class, a world at peace, social stability in the US, increase in productivity driven by technology spending, the...more

Tax-Efficient Investing: A Wise Choice

Taxes can take a chunk out of your investment returns; yet, many investors don't give much thought to taxes when they make investment decisions. While investment decisions shouldn't be based entirely on tax considerations, tax-efficient investing may make a significant difference in your net gain....more

Investing The American Way

Now that most investors have a substantial period of recent bear market experience to draw on, I would suggest examining the methods that you will use in the future to grow your assets. I teach my clients to view their investments and financial life as a business. Our goal is to use the same...more

Reduce the Sting of an Investment Loss

Many people find it hard to sell losing investments. This deep-rooted reluctance even has a name, the 'disposition effect.' The disposition effect appears to trouble everyone, according to a recent article in Barron's, an investor newsweekly. Academic researchers have turned it up in Finland,...more

Market Volatility: Unwelcome But Inevitable

With the recent corporate accounting scandals contributing to what was already a volatile stock market, no wonder many investors are asking some difficult questions. "Is the market ever going to improve?" "Should I pull all my money out of the market?" "Can I ever trust corporate America...more

Two Opportunities to Decide if That's Light You See at the End of the Tunnel

The next few months will present two excellent opportunities to conduct a quick investment checkup. The first is when you receive your annual statements from mutual funds and brokers (and, hopefully, tally up those fat gains for the year). The second is when you finish preparing your tax return...more

The Folly of Market Timing

These days, some people may have a 'sure-fire' way to time the stock market. Just check out the Internet. You can find screens advertising market timing services. A trip to your local library will yield an equal abundance of market timing theories in books, magazines, and other periodicals. And...more

How Will You Handle Your Investing Future?

What if the market does not go virtually straight up as it did between 1982 thru 2000? What if we are indeed stuck in a multi year period of trendless, volatile or downward moving market? What if we are in a period similar to that of 1966 thru 1982 where the Dow Jones Industrial Average started at...more

Vince Lombardi Investing

Running a football team is no different than running any other kind of organization - any army, a political party or a business. The principles are the same. The object is to win - to beat the other guy. Maybe that sounds hard or cruel. I don't think it is. - Vince Lombardi Let's say you're a...more

Protecting Against Disaster

With the ever-accelerating pace of change in the global markets and a sea of investment alternatives, many investors feel rather overwhelmed at the task of managing their investments. Is this you? In our view, a successful investment program is one that not only earns competitive returns but...more

Intermarket Analysis

Most investors have something I like to call TVS, or 'Tunnel-Vision Syndrome'. They tend to focus on one market and absolutely analyze it to death. There scope is so narrow that they tend to miss the forest through the trees. The truth is that investors who focus on the bigger picture portrayed...more

The Hottest Investment Tips

Have you ever received a really hot investment tip? How many times has it actually worked out? "Not-so-hot tips" can throw a kink in your long-term investment approach. Here are some sound tips for the long-term investor: Get started early It's impossible to stress this point too much! ...more

The Road to Successful Investing

The road to successful investing is paved differently for each investor. One investor's road to success may be the high road while another's may be the low road. But common to both investors is basic principles that are true to form no matter which road an investor finds himself taking. Below...more

Investment Philosophy Question

With the ever-accelerating pace of change in the global markets and a sea of investment alternatives, many investors feel rather overwhelmed at the task of managing their investments. Is this you? In our view, a successful investment program is one that not only earns competitive returns but also...more

A New Approach to Investment Planning

To formulate an effective personal investment strategy, it's useful to determine if your investment portfolio is well positioned to help you achieve your most important financial goals, such as funding a comfortable retirement or bequeathing wealth to your heirs. These days, sophisticated...more

Investing Over a Lifetime

Goethe once said, ?In the realm of ideas, everything depends on enthusiasm; in the real world, all rests on perseverance.? With regard to investment?a ?realm of ideas? if ever there was one?Goethe had it wrong. For enthusiasm, when it overwhelms cool calculation, is the absolute bane of...more

Stay on Track With a Summertime Portfolio Review

Summer is traditionally a time for fun, family vacations and a more relaxed pace of life. But between the baseball games and barbecues, it's a good idea to consult your financial planner about a midyear portfolio review to ensure that your investment strategies are still on track to help you...more

Tune Out The Noise. The Results Will Follow

Everyday we are bombarded with a plethora of investment advice. We see it in magazines and newspapers and we hear it on the radio and TV. But is any of this advice sound; or is it just noise? The first thing to do is to look at the source. Much of the media operates with an incentive to...more

Active Management Evaluation: Will Your Active Money Manager Or Mutual Fund Add Value?

Before (and after) hiring an investment manager whose approach is to actively manage a stock (or bond) portfolio, a thorough examination should be performed to determine if the manager has added value compared to a market-based (passively managed) benchmark. The reason these tests need to be...more

Active Versus Passive Management

The investment management world of today can be divided into two broad categories of management style, each reflecting a fundamentally different belief system regarding how modern capital markets behave. These two schools of thought are generally referred to as active and passive management. This...more

Are You Wired for Investment Success?

"Experience is the toughest teacher because it gives the test first and the lesson later." It is so easy for anyone to open a brokerage account, or a futures account and just start trading or investing. While I admire the spirit of independence and self reliance that leads non-professional...more

Buy and Hope versus Risk Management

Regular readers of this space know that we believe in Exchange Traded Funds as an alternative to individual stocks and mutual funds because of their flexibility and diversification. However, as much as we like ETFs, they can lose value just like most other types of investments. The past few weeks...more

Surviving a Bear Attack

Most investors know how to make money in a rising, (or Bull), market. Just buy some stocks and watch them go up ? piece of cake. But what can we do when the unfriendly Bear market awakes from hibernation and decides to feast on our stock holdings? We discussed selling in our last article and this...more

What is an Index and Why Should I Care?

Most investors have heard the term ?index?, but what does it really mean? An index is an assortment of investments designed to perform in a way desired by the entity that created the particular idea. For example, when people think of the stock market, they are usually picturing the Dow Jones...more

Investing Driving You Crazy? Maybe Its Because You Already Are! (Part 2)

In part one of this series on investor biases and behavioral finance we discussed the two major investor biases (cognitive and emotional). We recognized that both cognitive and emotional biases result in irrational decisions, with cognitive biases stem from faulty reasoning and emotional biases...more

Investing Driving You Crazy? Maybe Its Because You Already Are! (Part 3)

In Part 3 of this series, we will continue on in our analysis of cognitive biases. In Part 2 we discussed anchoring and adjustment, availability and representativeness. In this article we will discuss selective memory, overconfidence and mental accounting. Overconfidence Confidence can be...more

Investing Driving You Crazy? Maybe Its Because You Already Are! (Part 3)

In Part 3 of this series, we will continue on in our analysis of cognitive biases. In Part 2 we discussed anchoring and adjustment, availability and representativeness. In this article we will discuss selective memory, overconfidence and mental accounting. Overconfidence Confidence can be...more

Investing Driving You Crazy? Maybe Its Because You Already Are! (Part 3)

In Part 3 of this series, we discussed the final cognitive biases, namely overconfidence, selective memory and mental accounting. Remember, cognitive biases are biases or errors that are based on empirical factual knowledge. In this article we will discuss and provide examples of some emotional...more

Investing Driving You Crazy? Maybe Its Because You Already Are! (Part 3)

In Part 3 of this series, we discussed the final cognitive biases, namely overconfidence, selective memory and mental accounting. Remember, cognitive biases are biases or errors that are based on empirical factual knowledge. In this article we will discuss and provide examples of some emotional...more

Investing Driving You Crazy? Maybe Its Because You Already Are!

When it comes to your investments and portfolio, are you overconfident? Are you just a bit too greedy? Do you panic at signs of a stock market drop, or become elated during latest surge? Do you choose stocks based on vague feelings? Does a 10% loss bring you more disappointment than an 11%...more

Portfolio Rebalancing Vs. Market Timing

You probably have a pretty good idea of how your investments have done lately. You may even track them daily. But to keep your portfolio in shape, you need to do much more than check the bottom line. You need to check the scale (or, your asset allocation). It's easy for your portfolio...more

Understanding Value vs. Growth Investing

Everyone hears over and over, from Morningstar and other sources, about value versus growth investing. The problem, and reality is, that most investors simply don't understand the difference between the two philosophies. Notice that I did not say between the two different kinds of stocks. Why?...more

Ruminations on the Investment Process

This is a very complex topic that I will cover here in abbreviated form. The main steps are as follows: Determine the goals and resources available. The first step is to determine what you want to accomplish. For example, many people have retirement as one of their goals (which we prefer...more

One Best Thing Syndrome

Could it be that some of the traits that help people become wildly successful are the same ones that cause difficulty later on?. Everyone knows of a successful business person who focused their efforts and talents relentlessly in one direction and rarely looked back for fear of losing their...more

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