managing-investments_DETAIL

9 Tips for Managing Investments

09/20/2022 Written by: Jenny Boudreau

Successful investing requires patience and discipline, but emotions can get in the way. To help you stay focused on your investment strategy, remember the following tips for managing your money.

#1: Markets can be turbulent.

It’s essential that you prepare for market declines. Despite the temptation to pull out of the market at each downturn, it may be worth considering a smaller adjustment to your investment approach. By remaining flexible, you may be able to take advantage of opportunities while managing risks.

#2 Don’t try to time the market.

When markets rally or pull back, it may be tempting to buy or sell. However, investors often guess wrong, potentially missing out on the best market plays. It may be better to make minor adjustments to help you stay the course.

#3 Create a portfolio that reflects your overall risk tolerance.

When building an investment portfolio, the objective is to take on the amount of risk that aligns with your goals and timelines. Ask yourself the following questions:

  • Am I too heavily invested in one asset?
  • Why do I own the investments I own?
  • Do I hold the same investments in different accounts?

#4 Too little risk may mean missing out.

Many factors can lead investors to low-risk investments, such as global uncertainties and fear about the economy. While minimal risk may seem like a safe move, you could miss out on opportunities. The following questions may help you determine whether you should consider taking on more risk:

  • Do I have enough growth-oriented investments in my portfolio?
  • Can I accept short-term losses for potential long-term gains?
  • Am I comfortable taking on more risk to pursue higher investment returns?

#5 Avoid emotional decision-making.

Before you start investing, think about your long-term goals and why you’re investing. Use this vision to find a balanced approach that includes planning ahead, resisting herd psychology, automating investments, and building a diversified portfolio (see #6).

#6 Diversify your investment portfolio.

Diversification is designed to help manage risk by identifying investments that may perform differently under various market conditions. To diversify your portfolio, choose a mix of investments across a variety of areas with various rates of return, and regularly rebalance your portfolio.

#7 Focus on your goals, time horizon, and risk tolerance.

Many investors make investment choices based on past performance. However, investments that outperformed last year may – or may not – perform the same this year. In other words, by the time you decide to invest, it may be past the opportune investment’s time.

#8 Consider the impact of taxes.

Consider the tax impact whenever you buy or sell an investment, develop a financial strategy, or determine your estate or philanthropic approaches. If your investment returns have different tax treatments, your financial position may change.

#9 Work with a financial professional.

Positioning your investment portfolio to reflect your goals, time horizon, and risk tolerance can be complex. Financial professionals take the time to understand your unique situation and work with you to help build a personalized strategy for your current and future needs.

The advisors at AssuredPartners Investment Advisors are ready to answer your questions, provide reassurance, and discuss investment opportunities.

Charitable Donation square edit
Charitable Giving
Wealth Management04/24/2024

When developing your estate plan, you can do well by doing good. Leaving money to charity rewards you in many ways. It gives you a sense of personal satisfaction and can save you money in estate...

Financial Plan square
Don’t Let Emotions Get in the Way of Your Financial Plan
Wealth Management04/03/2024

Taylor Tepper, a financial journalist for Forbes, writes that when the vast majority of us try to trade stocks for short term gain, we do a horrible job. "We sell them when we should buy," he says,...

60 40 allocation square
Three Reasons Why the 60/40 Allocation can be a Good Starting Point
Wealth Management03/13/2024

Many people have the misconception that the primary goal of investing is to make as much money as you can as fast as you can. Unfortunately, you can't just order up outsized returns like a delivery...