A Do-It-Yourself Approach to Target Date Retirement Investing

Advertised as a one-stop shopping, automatic-pilot retirement vehicle, life cycle or target date mutual funds have become increasingly popular. These funds are aimed at individuals seeking an all-in-one retirement fund to invest his or her retirement nest egg, with a target date whose termination date approximates the date of his or her projected retirement (e.g.,…

 

Margin: A Portfolio Lever for Buying and Selling Stock

Borrowing money through a margin account to purchase securities can be a profitable and wise investment strategy. But debt creates financial leverage: The money in a full payment purchase can instead be used as a type of down payment to buy a much larger block of stock. This means that gains—and losses—in a margin account…

 

Peculiar Facts From 500 Years of Finance

If you are like most people, you learned history in classes that largely covered facts related to dates, places and people … and you probably couldn’t wait until the school bell rang. Sadly, children’s exposure to history is often framed in a way that is less interesting and engaging than it could be, and it…

 

Investing Rules of Thumb and Key Phrases: Gleaning the Nuggets of Truth

Editor’s note: This post was excerpted with permission of the publisher, John Wiley & Sons Inc. from “The Forbes CFA Institute Investment Course: Timeless Principles for Building Wealth.” Copyright © 2011 by Forbes, LLC. More information about the book and a multimedia supplement are available at www.cfainstitute.org/forbes. Humorist Will Rogers was once asked for investment advice….

 

The Alliance for Investor Education Presents “Funding Your Future: The 2017 Investor Boot Camp”

The Alliance for Investor Education is sponsoring a free Investor Boot Camp on Tuesday, December 5, at The Army and Navy Club in Washington, D.C. Attendees of Funding Your Future: The 2017 Investor Boot Camp will hear from experts on a range of investing topics, explore free resources, and gain support from organizations and agencies to achieve…

 

How Investors Miss Big Profits

Mutual funds are permitted to report investment returns for one, three, five and 10 years (“alpha”), but how many investors actually kept their investments unchanged for those specific periods? If all investors did not hold on to their investments for those precise periods, then they had to be doing better or worse than was being…

 

Liquidity: How Much Do You Need?

Individuals have varying needs for assets that are readily available. How does one decide the appropriate level? A Keynesian analysis comes from the late Baron of Tilton. How much of a liquid balance should investment portfolios contain? That question crops up frequently in financial planning as investors try to determine their overall portfolio. The first…

 

Best Practices for Portfolio Rebalancing

The primary goal of a rebalancing strategy is to minimize risk relative to a target asset allocation, rather than to maximize returns. It is well documented that a portfolio’s asset allocation is the major determinant of a portfolio’s risk-and-return characteristics (assuming a well-diversified portfolio that engages in limited market timing). Yet, over time, asset classes…

 

Optimizing Your Retirement Income: What Works Best and Why

With tens of millions of baby boomers already retired millions and more likely to enter retirement in the next decade, the hard truth is that only a small minority are accumulating enough savings to provide for their income needs during decades in retirement. This uncomfortable reality is particularly true given the overall rise in life…

 

Keeping Track of Your Portfolio: What to Monitor and When

Setting up a reasonable and workable investment plan is one of the most important decisions an investor can make. But once that decision is made, an investor’s work is only half done. An equally important task consists of monitoring the portfolio to make sure it is conforming to your original plan. How do you go…