Written by DR
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June 2008 was a difficult month for the stock market. Along with the market, my investments were down significantly. For the year my investment portfolio is down about 10%. On the bright side, my online income held steady.
Here are all the details of both my investments and online income. Read the rest
Written by DR
I read with dismay the following from an “investment professional” in yesterday’s Washington Post:
Now is not the time to drink the “buy and hold” investment strategy Kool-Aid. Be conservative, limit your risk–and sleep well knowing your investment principal is not going to continue to decline.
The comment was in response to the following hypothetical question: “If I don’t want to be in stocks right now, what should I do with my investment money?” This investment adviser went on to recommend a portfolio comprised of 80% TIPS and 20% gold. Here’s why he’s dead wrong. Read the rest
Written by DR
World markets plunged yesterday. Just to recap:
- Britain’s benchmark FTSE-100: -5.5%
- France’s CAC-40 Index: -6.8%
- Germany’s blue-chip DAX 30: -7.2%
- India’s benchmark stock index: -7.4%
- Hong Kong’s Hang Seng index: -5.5%
- Canada’s S&P/TSX composite index: -4.8%
- Brazilian stocks: -6.6%
- Argentina’s Merval index: -6.3%
About the only market not to decline was the U.S. markets, because they were closed for the holiday. Tomorrow, the U.S. markets are sure to follow suit. The real question is this: what should investors do? Read the rest
Written by DR
Year end is a perfect time to give your retirement and other investments an annual tune-up. Each year at this time I evaluate my 401(k), rollover IRA and taxable investment accounts to see if I should make any changes to my asset allocation plan for the next year. Generally, I look at five things: (1) whether my asset allocation plan should be adjusted, (2) whether my investments are tracking to my planned asset allocation or need rebalancing, (3) whether my investments are distributed between my retirement and non-retirement accounts in the most tax efficient manner (known as asset location), (4) whether any changes to the mutual funds I own have been made that might cause me to reconsider my investment, and (5) how my investments have performed over the past year. From this information I decide what changes, if any, need to be made to my current investments and contribution choices for next year.
This annual checkup takes a couple of hours, but is time well spent. Over the next five days we will walk through each of the five steps above. In the process I will show you everything I invest in and my rationale behind each choice. Of course, my investment decisions may not be right for you, but the process will show you how to go about designing an asset allocation plan, selecting mutual funds, and monitoring your choices. Today, we will look at how to build an asset allocation plan, using my asset allocation plan as a guide. Read the rest
and 
. These are two excellent books that every investor should read. The third book, called 
, was just released a few weeks ago, and Mr. Ferri has given my three hardback copies of the book. I had already purchased a copy of The ETF Book for myself, and although I’m not finished reading it, so far it’s proving to be an excellent book about ETFs. 