Investment does not relate specifically to the stock market, you could invest in anything that you think will have an upward trajectory or percentage return. Find those items that offer the lowest risk/ highest return. Diversification is an admission that you don’t know which particular asset class, stock or bond (or which country) will do best. So own a bit of everything
Think in terms of what offers the best returns. You do not need to be tied to Stock Markets. For example, the help to save account (UK only), if you are eligible, offers a guranteed return rate of 50% over 4 years. Beat that in the market! Look for opportunities everywhere, low risk, high reward.
Avoid putting all your money in real estate, stocks, bonds, or any single investment class. Diversify within asset classes. Don’t put all your money in a favorite stock such as Apple, or a single MLP, or one piece of waterfront real estate that could be washed away in a storm. Diversify across markets, countries, and currencies around the world. We live in a global economy, so don’t make the mistake of investing solely in your own country.
- Bear Markets
- Index Funds
- Index funds allow you to invest, at minimal cost, in a portfolio designed for Diversified Returns and carry minimal fees as low as 0.05%. (Active investors as a group will receive the same gross return minus 2% or more). They have historiclly outpaced the market.
- Index funds can be highly profitble in a Bear Markets (or Corrections) to give you instant Diversified Returns (at a low cost) across massively undervalued markets.
- Holding Cash is a Bad Investment
- Market Crash
- Throughout a crash continue to invest heavily in the stock market. Take profits from strong asset classes such as Bonds and invest the proceeds in weaker asset classes such as US small-cap and large-cap stocks, international stocks, and emerging-markets. Instead of betting on individual companies, buy index fundsto gain instant Diversified Returns at a low cost across massively undervalued markets.