Today, many “investment trend” websites are enticing online traders to join. Investors who follow the trend – also known as “momentum trading” – invest in stocks based on rising market prices rather than company fundamentals.
The strategy of following the investment trend performs best in a bull market. However, selling before the trend reverses is a skill that eludes most investors…. Read more
The risk-reward ratio is an attempt to quantify the amount of risk you need to take in order to get an anticipated return from any investment.
If you were to only consider past returns when deciding whether to invest in stocks or bonds, stocks would appear to be the clear winner…. Read more
To the dismay of yield-seeking investors, interest rates remain at historic lows. Although rates on long-term bonds may begin to inch up, analysts generally expect that we may remain in a low-interest-rate environment for a while longer. So, what are income investors to do? It is important to understand the risks of reaching for higher yields and realize there may be less risky ways to increase income…. Read more
Over the past several years, the market has climbed to historic highs, prompting analysts to sound the alarm over the next stock market crash. While I can’t say when the next crash will occur, I can say it’s reasonable to assume that there will be another stock market drop at some point…. Read more
Since one person’s good investment choice may be a huge mistake for someone else, what factors should you consider when deciding upon a potential investment?
In investing, the only hard and fast rule is that past performance never guarantees future returns. Though you should try to understand why a security acted in a specific way in the past,… Read more
Was Miguel Cervantes’ Don Quixote fighting imaginary windmills or market volatility when he said, “Don’t put all of your eggs in one basket?” Putting all of your assets in one basket doesn’t keep them as safe as you might think because there is always a risk that you might lose them all at once…. Read more
How can you increase your retirement income and avoid risk? Many people simply put their money in the bank. But the good news is that there are other options for reducing risk and generating more retirement income.
While banks present a lower risk than the markets, bank deposits historically have low yields…. Read more
Recently, a couple asked me what they should do with their money in the bank. I hear this question quite often. However, as every individual investor’s situation and circumstances are different, there is no standard response that fits everyone. To figure out an answer for this particular couple, I asked:
What’s the intended purpose of this money?… Read more
At an initial meeting, a new retiree told me, “I’m not really sure what stocks I own.” When I asked how he had put together his portfolio, he explained that some of the positions came from an inheritance, while others… “Well, I’m not really sure,” and a couple of stocks were recommendations from “this guy who sits next to me in shul.” When I asked him if that guy still thinks they’re good stocks,… Read more
If you are looking for an investment with a steady yield that is generally considered more predictable than the stock market, consider buying bonds. To watch a short explanatory video about bonds, go here: Profile-financial.com/bonds.
What are bonds?
When you buy a bond, you essentially lend money to a government,… Read more
