By: Steve Smith
Every turn of the calendar brings new predictions, promises, and platitudes on how to be a better or more successful investor in the coming year.
Lucky for us, most of these ideas or rules haven’t changed over time so there is no need to learn any new “tricks” or skills. Just being reminded of some simple concepts and basic behaviors should be sufficient enough to allow most investors to navigate whatever the market throws at them.
1. There Is No Reward Without Risk
Many people operate under the assumption or are led to believe, that through practices such as diversification, portfolio protection, hedging, etc. that risk can be eliminated.
But there’s an old saying, “Risk can be quantified, assumed, bought, sold, transferred, created, subordinated, reassigned, split, delayed, diluted, fragmented, hedged against, and laid off. Risk can respond to some methods, but it is still a risk, and is near impossible to eliminate.”
Enticingly high yields. Smooth returns. Sophisticated ‘black box” systems. These are just a few of the siren songs that can lead investors astray.
Take a… Continue reading at StockNews.com