An Investment Philosophy for Success

An Investment Philosophy for Success

Investments are used to achieve long-term goals; savings are used for short-term goals.

Diversification, with exposure to stock, bond and other markets, reduces risk.

Investors should know how their investments fit into their portfolios and why they own particular assets.

Investment cost minimization is crucial for long-term success.

An investor's primary decisions involve choosing a mix of assets to be held in a portfolio, not the selection of individual investments.

Outperforming the financial markets consistently is difficult.

Risk is multi-dimensional. Investors should weigh "shortfall risk" - the possibility that a portfolio may not meet long-term financial goals - against "market risk," - the reality that returns may fluctuate.

Market-timing and performance-chasing are not part of a winning strategy.

An investor should not expect future long-term returns to be significantly higher or lower than long-term historical returns for various asset classes and subclasses.

An Investment Philosophy for Success

Diversification, with exposure to stock, bond and other markets, reduces risk.

Investment cost minimization is crucial for long-term success.

Outperforming the financial markets consistently is difficult.

Market-timing and performance-chasing are not part of a winning strategy.

Investments are used to achieve long-term goals; savings are used for short-term goals.

Investors should know how their investments fit into their portfolios and why they own particular assets.

An investor's primary decisions involve choosing a mix of assets to be held in a portfolio, not the selection of individual investments.

Risk is multi-dimensional. Investors should weigh "shortfall risk" - the possibility that a portfolio may not meet long-term financial goals - against "market risk," - the reality that returns may fluctuate.

An investor should not expect future long-term returns to be significantly higher or lower than long-term historical returns for various asset classes and subclasses.