Diversify across time

Timing techniques (when to buy or sell) are very popular and many novices believe that they can make tons of money using them, paying good money to learn in the process. Research shows that these techniques are ineffective. Honest old hands will tell you that they are wrong half the time. It is prudent to accept that you cannot time the market. The better alternative … Continue reading Diversify across time

Diversify your portfolio

Research also shows that owning a mix of assets is less risky than holding one asset. This arises because the prices of these assets don’t exactly move in tandem. It is usually applied between asset classes (stocks, bonds, and real estate) and within the stock portfolio (by industry, by geography). Spread your stocks over at least 10 companies. If your investment is large enough, increase … Continue reading Diversify your portfolio