5 Ways to Manage a Concentrated Stock Position
Investors can wind up with a concentrated stock position in different ways. But it’s most often from an inheritance, founder, or employee with company stock.
Category: Managing Risk
Risk management is a key component of any investment strategy. It helps investors protect their assets by aiming to reduce market risk though diversification, allocation between stocks and bonds, and other financial planning measures. By managing risks effectively, investors can help protect their portfolio against diversifiable risks and increase the likelihood of achieving long-term goals.
The risk of loss is inherent in investing: market volatility, changes in economic conditions, and geopolitical events are always there. It’s not possible to protect against all types of investment risk, but proper risk management seeks to mitigate risks than can be managed, such as company-specific risk.
Diversification of investments across different asset classes, sectors, and geographies, portfolio rebalancing, and an ongoing discussion about investment risk profile are some ways we seek to minimize investment risk.
Bond Basics: How Bonds Work and the Benefits of Investing in Bonds
How do bonds work and why buy them in your investment accounts? There are several benefits of investing in bonds. Most notably, bonds provide investors
Stocks vs. Bonds: Differences in Risk and Return Make a Case for Both
Stocks and bonds differ in many aspects, including the risk and return investors can expect. Because of these differences, stocks and bonds accomplish different things
Stress Testing a Financial Plan Using a Risk Simulation
What happens if…? That’s the million-dollar question. Stress testing a financial plan and retirement projections can help investors feel more confident in the likelihood they
Don’t Get Taken Down When Your Employer’s Stock Sinks
What can happen if you own too much of your company’s stock? The coronavirus outbreak is yet another example of the dangers of having too
During Times of Market Volatility, Focus on What You Can Control
Amidst the vast uncertainty in the markets right now, it’s more important than ever for investors to understand the benefits—and limitations—of diversification. Having the right
How Do Bonds Perform During a Recession?
The globalized nature of the world economy makes diversification a tall task. Although past performance is not indicative of future results, history is a helpful
What History Can Teach Us About Asset Class Diversification in 4 Charts
Setting your asset allocation is like drafting architectural plans when building a home; it provides a map to guide the construction of your investment portfolio.
How the Timing of a Stock Market Crash Can Impact a Retirement Plan
There’s plenty for investors to worry about when their financial livelihood is on the line. When planning for major financial decisions such as retirement, individuals
Investing Outside of the S&P 500
If you’ve ever heard excerpts from the latest Apple earnings report, you may have thought, ‘so what?’ Well, for many investors, Apple’s relative performance could