Is Your Portfolio Built to Last?
Researcher Dalbar, Inc. examined the effects of investors’ decisions to buy and sell their mutual funds. Here are their findings:
Investors are prone to certain emotional – and often irrational – biases that affect their ability to make sound decisions about money.
Estate planning often can involve the creation of a trust – a legal entity created to hold assets for the benefit of certain persons or entities. Trusts are managed by trustees who often hold title on behalf of the trust.
How long does it take to double your money? It depends on the growth rate. The Rule of 72 is a simple math formula to determine the number of years it would take for a sum of money to double. Simply divide an assumed rate of growth (let’s say 7%) into 72. The answer: 10 years. If the rate of growth was 10% the answer would be 7 years.
Bonds offer income and preservation of value on maturity. Between when a bond is issued and when the bond matures the market value of that bond will fluctuate daily. Why? Because interest rates fluctuate every day. An easy way to remember this is to think of a see-saw. When rates go up, bond prices fall. When rates go down, bond prices rise.
What we expect will happen to bond prices if interest rates Rise/Fall by 1%
Example used as illustration only, not indicative of any particular investment, actual results will vary.
Asset allocation is the process of diversifying investments among various asset classes, such as stocks, bonds, international securities and cash. The strategy seeks to maximize returns for a given level of risk and specific portfolio objectives.