years many consumers have been concerned about
the risk of investing and how the fear of them actually investing in
their financial future was based on uncertainty about how finances really
work—and their fear to face and overcome that fear.
discussion we will examine risk in great detail so that you can get a concrete
understanding of what it is—and how you can reduce risk in your financial
You will now be able to confront the risks that you will face in a manner that you can understand—and apply to benefit yourself and your family in a meaningful way!
What are common investment styles or investment philosophies?
It is important that you understand that there are basically 3 investment styles—however, there are other styles as well.
Even so, if you master these 3 investment styles—you will be in position to assess your style and use it to move yourself and your family towards the goals and objectives that you desire.
are you watching at the “AMC” theater?
By memorizing the preceding sentence—you put yourself in position to always know the 3 major investment styles—in an easy to recall manner!
Now that you
know the 3 investment styles—let’s explore each style in greater detail and
then go over the various types of risk that you will find in the credit and
financial markets that are (or should be) of concern to you and your
We will then conclude by discussing ways that you can reduce the various forms of risk that you may face!
An aggressive portfolio would be weighted more heavily towards stocks and would normally include aggressive growth stocks and international and emerging market stocks.
Many aggressive portfolios would have 70% or more of the portfolio in stocks—usually suitable for those with long investment horizon or those who have addressed their finances in a comprehensive manner—and have additional funds to invest aggressively.
A Moderate fund would on many occasions consist of 60% stocks—and bond and other investments making up the remainder (treasuries, t-bills, money market etcetera).
A conservative fund would be weighted at approximately 50% in stocks (or less) and bond and other investments making up the remainder (treasuries, t-bills, money market etcetera).
With all of the investments your goals, risk, income, and personal situation must be taken into consideration—as they will further determine your investment philosophy!
Other areas of risk that you should be concerned about include the following:
Always realize that a certain amount of risk will always be present, therefore don't let what seems to be a vast amount of risk deter you from pursuing your goals.
Make sure that you do all that you can on the front end to reduce or minimize the risk that you will face as you improve your credit and finance position!
All the best to minimizing your risk and achieving a lifetime of investment success...