Finances – Essential Tips for Finances and Wealth Management
Home Buyer News Palm Springs
1. Risk tolerance identification: Risk and return are inextricably linked. They are almost always in proportion to each other, the greater the risks the higher the returns, and seldom otherwise.
Remember that investments with high returns are equally capable of inflicting heavy losses. A safe portfolio does not necessarily exclude very risky assets; in fact, excessive reliance on safe assets may actually increase portfolio risk. Even investors who seek the safest possible portfolios will own some risky assets; a portfolio consisting of ‘safe’ blue chip shares will often have a lower return than one split between risky smaller stocks and cash.
4. Control your emotions: 90 percent of investors invest with their hearts and not with their brains. Always have a reasonable approach equipped with sound logic. Remember, even if you suffer a loss, there is only one way to go and that is forward.
via Sharon Ellenz
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