{2:20 minutes to read} People often make the mistake of investing purely in the S&P 500 because it encapsulates the stocks of 500 large-cap US companies without realizing the risks — or rewards — of a globally diversified portfolio. Consider a globally diversified portfolio to reap rewards beyond the S&P:
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We live in a society of immediacy. We’ve become used to services that give us immediate gratification. If you want to be a successful investor, one of the most important attributes — after following financial science and academic research — is patience.
If you invest in global and diversified equity portfolios and expect to receive high returns, you have to expect there will be times of disappointment. The average return over time has been around 10% in globally diversified equity portfolios. Continue reading
{2:30 minutes to read} Sometimes people look at their portfolios and wonder why they own international stocks, specifically in emerging markets. What they may not realize is that because they have a global portfolio, the assets within that portfolio are not always moving up or down in lock step. It could be said that these people are recency biased. Continue reading
Retirement preparation is about planning and adhering to the plan, which includes both saving and investing.
Many plan from the start to live on withdrawing 4% of their investable assets per year in retirement, which fluctuates as time goes on, according to the value of their account. This relatively small withdrawal rate can help insulate them from market declines because they know that amount is just 1/20th to 1/25th of their portfolio. Continue reading