Investing 101: 9. Conclusion

24 Apr    Investing

Through the various sections of this tutorial, we’ve introduced and discussed a number of investing concepts and investing vehicles. Among them are:

· Stocks

· Bonds

· Mutual Funds

· Passive index mutual funds and ETFs

· Active management

· ETFs

· Real estate and alternative investing

· The importance of diversification

· Compounding and the benefit of starting early

· The concept of building a diversified portfolio

· Correlation between different investments

· Investing expenses

· The impact of technology on investing

· Robo advisors

Moreover, we stressed the idea that investing is not one size fits all. Different strategies work for different investors and different situations. Additionally, an investor might employ more than one strategy, or choose a variety of investment vehicles depending upon their goals.

Have a plan and a strategy

Just like going on trip in your car, it is important that investors have a plan and a destination in mind before investing their money. Your goals—whether planning for retirement or buying a home—dictate your time horizon, which dictates your tolerance for risk. Additionally, you want to make sure that you diversify your investments so that some do well when the rest of your portfolio might not. This approach allows an investor to construct a portfolio that is in line with their risk tolerance and that balances potential return with some downside risk protection.

Your journey is just beginning, however. Your challenge is to keep learning and stay informed.

ByVision Financial Solutions

Certified Financial Planner

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