Skip to main content

Investment Minefields

Do you know that many listed stocks, and even worse for unlisted investments, do not perform well over the short-term or long term. It's incredible how much garbage is out there and is being hyped and sold by investment professionals. I have at least 200 positions that I follow and track on a regular basis and many of those positions just do not live up to their potential. It's an investment minefield out there. A common, but effective investment strategy is the "buy and hold strategy", but the recession that began in 2007, basically blew that theory out of the water. As a matter of fact, a "buy-and-hold strategy" may be dangerous in this market right now. However, here is an article in the Wall Street Journal on a star trader, working for a popular mutual fund, who has been really successful at not trading and basically buying and holding. I thought the article was interesting, but I do not think the article is entirely true. This trader may not trade as often, but he is still definitely trading and trading in a big way.
Therefore, before you make an investment in anything, have independent research, in addition to the information being provided by your broker or advisor. For example, as I was writing this article, I had a broker in Florida call me on a start-up currency fund that he and his firm was touting. He said, "the fund was part of an ETF strategy that is now a mutual fund." I was like "huh''. What the hell is he talking about? I told the representative to email me the fact-sheet on the fund; I received the fact sheet and was truly disappointed with its presentation and contents.

Use the available web-based search tools provided by the Securities and Exchange Commission to keep abreast of common or popular investment scams. Try the "Fast Answers" link on their site which can quickly provide answers to just about every legitimate investment term out there, along with other web-based search tools to help you find the information that you need to make a good decision. I use their site all the time when I am researching a company and its officers for a possible investment.

Finally, investment sites that allows you to build watch-lists are extremely useful, because these sites gives you a chance to follow a position before you make a financial commitment to the stock or investment. Follow or track the investment you are interested in for at least three months (90 days) before you invest.

With tax season here, take advantage or our low fee Roth IRA and reduce your tax liabilities for 2009. Learn about the tax advantages of a Roth IRA, combined with our dynamic management portfolio service which automatically adjusts your investments based on an asset allocation model that you select. Invest in target date funds, stocks, mutual funds and ETFs- Traditional IRAs are also available. Call us now for more information at 770-572-2715 Office.

Comments

Popular posts from this blog

Natural Gas Unnatural Rise

I am reading lots of buzz all over the Internet on the rising prices in oil and natural gas assets and I am like here we go again. Yes, oil and gas stock are good investments but we are not running out of oil nor natural gas anytime soon. However, many investors are snapping up oil and gas ETFs like delicious hot pancakes. For example, the recent surge in investor demand for the US Natural Gas Fund , whose net assets has swelled 10 fold as investors snap up the shares, has almost caused the fund to temporarily shut down twice due to lack of shares to sell. There is no reason to load up on oil and natural gas stocks or ETF gas funds yet. Read the recent short term energy report from the Energy Information Administration - Official Energy Statistics from the US Government . The US Gov't is projecting lower demand and lower prices- a possible supply glut . Just in case you still believe that oil and gas stocks are the way to go, here are three natural gas ETFs that you may find inter...

The Borg economy

At any given moment during market hours, I am filled with feelings of dread about the US economic system, like its right on the precipice of disaster, and sometimes I feel like its like the fictional Borgs of Star-Trek- Exhibiting a "rapid adaptability to any situation or threat, with encounters characterized by matter of fact imperative 'resistance is futile'." Expecting a strong market rally today. WSJ Online before the bell gives a good synopsis of what to expect today. Commodities and oil will be up today after an overnight jump in oil and commodities prices overseas. Still convinced that the drivers behind the volatile commodities jumps are mostly related to huge institutional buying and selling- aka trading, and nothing to do with the cost of producing and selling the commodities. Still looking for a good entry point in our favorite fund the ProShares Technology Fund today. Will keep you posted on any new developments. 06/10/09 09:43 AM

A Few Tips from the Wise

By Rick Walter Good morning my fellow investors. Hope we all have a great day today. There was a little blood in the streets yesterday, with a broad sell-off across the board. Well, I've been calling for a slight sell-off for about the last month, because its always a good thing for the markets to blow off some steam after rising consistently for so long. You know, you got to keep the bubbles from forming. Further selling depends on how key parts of the U.S. economy continues to recover, which in my opinion is dependent on the manufacturing sector. A report from Automatic Data Processing said the "U.S. private sector shed 298,000 jobs in August, a faster rate of job losses than the 213,000 economist were expecting." Still, not as high as the same time ago last year but pretty substantial. So what are we going to do? A few tips from the wise . Review your investment strategy daily. Avoid going after high fliers. Avoid trading on rumors. Avoid trying to time the bottom. Ma...