Diversified investments is about reducing your investment risk and increasing your investment portfolio to more opportunities by investing in a variety of assets. In simpler terms, it means not putting all your eggs in one basket.
Why some people avoid making investment decisions…
Many investors avoid investment decisions by just following the advice of their bank or financial institution and believe they have been well diversified, more often than not, their investments are very poorly diversified, opening them up to risk from market swings and missing out on the many opportunities that occur in good and bad market times. As you probably know, this avoidance is usually based on one of two reasons. The first being the fear of losing money, and the second being simply not knowing so just avoiding it and hoping for the best.
Avoidance is very destructive to an investment plan and retirement plan. As in most cases the investor avoiding will invest as guided by their investment advisor, then not review at the plan again for many years or even until they are ready to retire. They set it and forget it. As a result they are usually shocked at the time of retirement at how little they have. Never realizing how much they could have had if they had learn’t just a little bit.
Ask your self these questions…
• Does your monthly investment statement come and do you look at it?
• Do you wonder what it all means?
• Do you just put it in a drawer unopened?
• Do you say to yourself “What’s the point anyway in opening the envelope,I don’t
understand any of this and I don’t want to see how much its gone down this month.”
This is avoidance.
We work all our life, many hours, day after day, week after week, and year after year. Does it not make sense to spend even just a couple hours a year on the thing that you are working so hard for? I am talking about your investments. The Diversified Investments plan you have in place to ensure a long, fun, and financially free retirement. The time in life were you finally get to sit back and enjoy it all! What if you could actually retire earlier than 65? And enjoy it sooner and for longer? Diversified Investments in your portfolio will make this more of a reality when the investments are properly diversified.
How can I avoid risk and be comfortable investing?
This requires diversified investments, which can greatly lower your risk and generate longer term higher returns on your investment. Many people believe that they are much diversified in their current mutual funds. My experience (as I have analyzed many) has been that they are not. In fact through the U.S. stock market recovery the Dow Jones Industrial average (DOW) moved from a low of 6,600 in May 2009 to breaking 16,000 in 2013an increase of 142% or 35% annually, most Canadians were invested more heavily in Canadian mutual funds and had little to know exposure to this historical growth. In the first 11 months of 2013, the DOW moved 42% while the TSX only moved 7.4% after fees of 2.5%; most Canadians earned less than a 5% return while the United States was sky rocketing back to life.
Using a proper diversified investments strategy in the above scenario, savvy investors benefit from the safety of the more secure Canadian financial market while taking advantage of the opportunity of investing in the less financially stable U.S. market as well. The best of both worlds!
This is just one small example of the huge benefits of diversified investments and we haven’t even talked about anything other than North American mutual funds and stock markets.
Being diversified in your Mutual Funds means you are still diversified in just one available investment asset.The greatest diversified investments include other assets such as Real Estate Property. The security of Bricks and Mortar add an extra layer of security as well as much higher returns on investment to a portfolio.
The answer is simple. Educate yourself a little. Be in control of your financial outcome. Don’t leave the financial security of your life in the hands of someone that makes money, a lot of money regardless of whether you do or not.
What are my options?
There are a wide variety of investment options available to you. But its the right combination and managing of these investment options that will create the best diversified investment portfolio for you. Its time to identify your investment goals and needs and look for the investment guidance that will make a real difference.
Where can I go for help?
Blackthorn has shown many people how to manage their own investment portfolio and how to easily take control of their financial situation and become excellent money managers.
As you make the decision to begin your journey in becoming an excellent money manager, and look toward a higher return on investment you must put yourself in the mindset of looking outside the traditional investment options as its not working for far too many people.
Now, as you let this all sink in for a minute. You’ll begin to realize that building diversified investments is not hard; its likely just unfamiliar. With the right investment direction, you will be well on your way to becoming an excellent money manager and creating a valuable and rewarding assortment of assets through diversified and productive investments.
Take one day out of your current life and change the rest of your life forever.