If you are concerned about losing money, perhaps you should evaluate how your investment portfolio is being protected from a significant market downturn. Here are some important questions to consider and key points to know in evaluating the protection of your portfolio:I’m not saying bonds are bad or that you shouldn’t invest in them. There are good and bad versions of almost everything.
Some investors are unaware that there are strong-growth capital appreciation and income investments and products. These might include private equity, real estate offerings, fixed indexed annuities, and limited partnerships. A smart investor knows to look at investments and products with an objective lens. In other words, the investor should have the ability to see them as tools to be used in accomplishing different goals without any bias associated with the type or social popularity.
It is important to understand that there are many different types of financial advisors. Some are limited to working only with specific types of investments, like stocks or insurance products, or representing only one company and their proprietary products. If you are going to approach investments and products as though they are tools, as we mentioned before, then you need to have access to a large variety of them.
Remember the old definition of insanity? It’s doing the same thing over and over but expecting different results.As an investor, you have to be open to change, new ideas, and alternative methods to accomplishing your goals. For example, if you are unwilling to change advisors, even though your goals are not being met, because you have a long-standing friendship with your current advisor, you should remember that business is business and friends are friends.
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