This week, Major League Baseball’s All-Star Game is scheduled to be played in Kansas City.
Whether you’re rooting for the American or National League, you’ll no doubt admire the ability and athleticism exhibited by these tremendous ballplayers. Of course, any all-star team is made up of players who bring different talents to the game.
And this same approach — of combining a collection of skills toward one common effort — can be found in other endeavors, one of which is investing.
Here, then, is one possible lineup of investment moves to consider:
- Diversify. All investments have both benefits and risks. As an investor, your goal is to help maximize the benefits and minimize the risks — and one of the best ways to do this is by diversifying your money across a range of assets.
Diversifying can help you reduce the impact of market volatility that might affect your portfolio if all your money was tied up in one particular asset class, and that asset went through a “down” period. Keep in mind, though, that diversification, by itself, cannot guarantee profits or protect against loss.
To prevent this from happening, you should meet with your financial advisor periodically to “rebalance” your portfolio.
When you invest in stocks, for instance, look for those companies that have strong management teams, competitive products and good business models. When you purchase bonds, look for those with high ratings from the independent rating agencies.
If you’ve built a diversified portfolio of quality vehicles, it may be easier to stay invested.
Conversely, if you’re dissatisfied with the growth of your investments, you may be investing too cautiously, which could be a concern when you’re striving to reach long-term goals, such as a comfortable retirement. Ultimately, there’s no one “right” way for everyone to invest, but you do need to match your portfolio’s composition with your individual risk tolerance and time horizon.
Your financial advisor can help your find the “lineup” of investment moves that is right for you. Put it to work soon.
This article was written by Edward Jones for use by your local Edward Jones Financial Advisor.