Determining how you invest should always begin with an assessment of your risk profile.
Therefore, how much money you’re willing to allocate to stocks will have an outsized impact on the volatility of your portfolio.
Here are 3 Ways you Can Decrease Stock Market Risk
First – Don’t get overly complex. The simplest way to lower the volatility of your portfolio is to take less risk by owning more fixed income securities such as bonds.
Second – Own uncorrelated assets. By combining two assets that perform differently, there may be a slightly higher return than either of these markets achieved on its own.
And third, expand your time horizon. Extending your time horizon is one of the best edges an investor can get these days.
But the shorter your widow, the higher odds you’ll end up with negative performance.
Call or email Wealthabundance Wealth Management to learn more about mitigating stock market risk.
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