8 Tips to Investment Portfolio Success

• Determine Your Asset Allocation - This involves matching your investment vehicles with your investment goals. Your investment choices should always be based on your age and level for risk tolerance. The earlier you begin to save and invest the more aggressive you can be in selecting amongst investment vehicles and options.

• Diversify your Portfolio - To maximize your returns, and manage your investment risk at the same time, you should not put all your eggs in one basket. Avoid placing more than 4%-6% of your investments in any one stock, including that of your own employer's. Real diversification means spreading your money across multiple asset categories including stocks, bonds, real estate as well as investing internationally.

• Invest in Index Funds or No Load Mutual Funds - An index fund is a passively managed fund that seeks to mirror the performance of a particular index (i.e. the Dow, S&P 500, Wilshire 5000, NASDAQ, Russell 2000). These funds are specifically designed to duplicate the performance of the unmanaged market index they are tracking. Management fees of index funds are typically no greater than about 0.50%. A mutual fund is a pool of funds of individual investors that is actively managed by a professional investment manager who buys and sells securities for the fund. Mutual funds have different investment objectives (i.e. growth, value, income) as well as various market capitalization sizes (i.e. small, medium and large cap). Each investor owns a share of the portfolio assets equal to his number of shares in the fund. A no load mutual fund has no sales charges, commission fees or redemption fees associated with the purchase and sale of its shares.

• Use Dollar Cost Averaging to Buy Stocks - This technique involves investing equal dollar amounts of money at regular intervals over a period of time. The result of this practice should be acquiring a greater number of shares when the price is lower and fewer shares when the price is higher thereby achieving an average cost per share which is lower than the average price per share. Dollar cost averaging helps minimize the risk of timing the market and thus having to determine the optimal time to acquire shares.

• Track Your Investment Expenses - You must vigilantly track all the investment expenses and commissions you are paying as they will dramatically impact the overall return on your investments. If you are paying heavy loads (expenses) and high commissions on funds which are performing below their general market counterparts you will want to divest yourself of these investments, using a tax savings strategy, as soon as possible. Stick with no-load funds and low commission investment vehicles.

• Rebalance Your Portfolio - Requires matching your portfolio's allocation of assets to meet your stated investment objectives after any area of your portfolio has experienced significant growth or contraction. This process goes hand in hand with asset allocation in that once you've determined your plan and the percentage you want in various categories of investments, you must rebalance or re-allocate your funds within your portfolio to insure that you are in compliance with your plan. Note that rebalancing your portfolio can be more complicated with your non-tax sheltered accounts as it could generate tax consequences.

• Don't Obsess About Tracking Your Portfolio - Keep your eye on the prize in the horizon and don't allow every downward market move to rattle you. It's far too easy to panic when you're watching daily, weekly or monthly results. You should be in it for the long haul and not influenced by trends and short term market fluctuations.

• Seek Out Investment and Tax Advice - Don't shy away from seeking the help of a professional when you need it. It's easy to understand the hesitation many people have in pursuing a so called expert's advice. The number of advisors who sell products behind the advice they give can make it confusing to know the true motivation behind a professional's recommendations. That's why it's essential to ask how any advisor is going to be compensated and what the amount of that compensation will be. Tax strategies should figure prominently into your investment planning as you want to balance both your pre-tax and after-tax retirement accounts.
Interview several tax advisors and seek referrals from colleagues and friends before narrowing the field down to one.

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Reasons Why People Should Invest On The Stock Market

I am a bit of a gambler but am not the normal type of punter who you may see in the bookmakers on a Saturday afternoon. I am the kind of gambler who only likes to bet on what you might call a racing certainty. I love the thrill of all things to do with gambling but in my opinion there is nothing better than riding the stockmarket wave. What I mean by this is attempting to make money from investing in stocks and shares, trying to predict when to buy and sell etc. In this article I will write about the reasons why I believe more people should invest on the stock market.

Now firstly it is important to mention that what I write in this article should not be seen as advice, it is merely my opinion on the subject of investing on the stockmarket. I am thirty-three years of age and I have a long term strategy when it comes to investments. Over the shorter term of, lets say one to three years, the stockmarket may not prove to be that profitable, if at all. For this reason this type of investment may not be suitable for some people who are over the age of sixty.

Over a period of five to ten years I have a great deal of confidence that the stockmarket will out perform any type of growth that you could find from putting your money into a deposit type account. These are the accounts that you might find offered by a bank or building society.
There are a vast number of options open to you, these will be dependent on your overall attitude to risk. For the really daring investor, someone who is willing to put their money into a high risk investment, you could be looking at investing in the shares of a single company. This could be a company on the Dow Jones or one from the FTSE 100, for example.

I personally like to invest monthly into a stocks and shares ISA. This smoothes out the peaks and troughs of the stockmarket, this is something which is known in the industry as pound cost averaging.

I have made a lot of money from stocks and shares over the last thirteen years and believe that I will continue to do so in the future. I hope you will too!

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Why Women Invest More Carefully Than Men

We all know the saying that men are from mars, and women are from Venus. This is an old saying that tells us that we have a different way of approaching life. We have a different opinion on most things in our daily life. Especially when we invest our money we use a different style and risk strategy.

Basically men are found to tend to focus on a single task while women have the tendency and ability of multitasking. The same attitude is adopted by men and women when investing. It is the large and bold investments that have more of a risk that men like investing in. On the contrary, women like to diversify their holdings so that they tend to assume lower risk in their investments.

It is this difference in thoughts of investing money that gives men and women different criteria when investing money. It is difficult to proclaim which method of investing is better or worse as the investment style of women is just as successful as a man's investment style. The only difference is that women are generally more creative than men in their investments.
Men like to do the investing themselves without any help from the outside. They rarely talk about their investment approach with outsiders. If they decide to ask for advice most of the time they will turn to a broker or investment advisor. But women like to join investment clubs for advice and strategy discussion as women are more social in nature. The less experienced women tend to do this more often ten the experienced female investors.

On joining this club, they can seek guidance from the seniors and more knowledgeable women who have been investing in stocks and shares for quite some time. When joining investment clubs, women should join clubs where there are women you trust and know. If these women are unknown, there is a chance that they may end up giving wrong financial tips with the intention of duping the woman.

The safest thing that any beginning investor should do is talk to a financial advisor or let an investment fund handle their money as they are more experienced and the change of losing your money is much smaller. These advisors can also assist women on the tax regulations involved.
In addition to all this, women tend to be more commercially savvy than men. They tend to focus on day to day expenses related to the finances of running a home while men concentrate on big-ticket items like the latest sports car. Women realize that if the cost of gasoline is rising, with some research, they invest in oil stocks that are due to rise after some time. The toys their kids invest in also give them ideas for investing. They find out about the new brand of toys kids like and find out more about the company so that they can consider investing in the toy company.
Most women are also in the habit of setting up a separate savings account where they will put some money in each time a paycheck arrives. Over a period of time these small amounts will end up to be be a big amount which can be used for investing purposes. It can be said that women tend to be far more creative then men when it comes to investing with less risk involved.

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