Here are three to consider: First, create a plan. By following an investment plan that’s based or risk tolerance, your specific goals and your time horizon, you may be able to make steady progress toward your objectives.
Second, keep investment performance in perspective. If you are constantly fretting about short price movements, you’ll be tempted to make hasty “buy” and “sell” decisions. Instead of focusing on an investment’s price drop today, look at its potential for tomorrow.
Finally, invest for the long term. Build and maintain a portfolio that’s designed to help you achieve your long-term goals, such as a comfortable retirement. By following these suggestions, you may never land on a magazine cover, but you should be pleased with the results.
Two Investment Mistakes: Too Much Risk - And Too Little
Of all the potential investment mistakes, two of the most common are taking on either too much or too little investment risk. To work toward investing successfully, you need to escape both these problems.
To avoid taking on too much investment risk, make sure you know what could go wrong with an investment. If you’re buying a stock, remember that the company’s management could change or its products could become noncompetitive. That’s why you need an exit strategy for leaving any stock - just in case.
How can you avoid taking too little risk? Be aware that if you only buy so-called “safe” investments, such as certificates of deposit, you may not achieve the growth you need to meet your long-term goals.
By balancing your investments according to your investment personality and time horizon, you can work toward achieving the right balance between too much and too little risk.
Contact Wendell at Edward Jones www.edwardjones.com
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