Whether it’s 2011, 2012 or 2020 – here’s a good investment strategy for making money by investing without a glass ball. A good investment plan takes into account the choice and timing of investments. If you can’t make money by investing in this simple strategy, rest assured that only a few and the lucky ones will make money.
Before you complete a good investment strategy for 2011 and look ahead, ask yourself an obvious question. Where do most successful investors (or where have they been in the past) invest in the long term to make money? The answer before the financial crisis was bonds, stocks and real estate. Today’s answer is the same for the average investor and takes the form of simple bond funds, equity funds and equity funds. In the final analysis, if all three of these investment frameworks are deposited, it is likely that we are in a depression and only a few lucky ones or smart speculators will earn by investing money.
A good investment strategy is not based on speculation or trying to put markets on time. No matter what you hear, no one has a proven and consistent record in the market time that the market gains significantly in the long run. If they did, they would make a lot of money by investing, and they would hide their secrets, not share them. So why not settle for a good investment strategy that makes only one big assumption: that the US will grow and thrive in the long run?
It is easy to invest money in the above three areas with mutual funds. To reduce your risk and add flexibility to your investment strategy, add a fourth type of fund called the money market fund. At current interest rates, they may not be a good investment, but they are safe and earn interest that tracks current rates. More specifically, by owning 4 different funds, you can complete a good investment strategy for 2011 and beyond and make money by investing in America’s future. From high security to higher risk and higher profit potential: the money market, the medium-term bond, the high-income capital stock, and the real estate stock are all you need to have.
A good investment strategy for getting your feet wet is just investing the same amount of money in four funds. The strategy of time does not require judgment or guesswork. One year later and once a year, all you have to do is move money so that all four funds have the same value. This automatically forces you to withdraw some money from the table from the best performing funds, and those that did not even move more money. The net result over time is that when prices go down you are buying more stocks, you are selling stocks that are quite expensive.
This is also a good way to make money by investing in the long run while keeping the risk. Buying and holding funds is not a good investment strategy, and many average investors have had problems in the past. For example, real estate funds were a good investment for several years until the financial crisis hit them. If you owned and held them, you would have accumulated a lot of money by 2009 and would be at risk of it … causing huge losses as a result of the financial crisis.
What I call a good investment strategy for 2011 and beyond is more than just simplicity. This strategy uses two of the most time-tested tools in the investment business: BALANCE & BALANCE and DOLLAR COST AVERAGEING. The first tool keeps you track while covering the risk, and the second is a tool that serves to reduce the average cost of investing by buying more shares when prices are lower and when they are lower.
You can put a good investment strategy in moderate risk by owning only 4 different mutual funds. People make money by investing in long-term bonds, stocks, and real estate; and smart people save some money on a safe investment as well as flexibility. In recent years, some people have been lucky enough to earn money by investing without a strategy. With a good investment strategy you don’t have to cross your fingers and rely on luck. If America moves forward in 2011 and beyond, so will you.