oter

Stick to your asset allocation from "summary" of The Bogleheads' Guide to Investing by Taylor Larimore,Mel Lindauer,Michael LeBoeuf

Maintaining your asset allocation is crucial for long-term investment success. This allocation determines the percentage of your portfolio that you have invested in different asset classes, such as stocks, bonds, and cash. While it can be tempting to try to time the market or chase hot investment trends, deviating from your asset allocation can have negative consequences. The purpose of asset allocation is to create a diversified portfolio that balances risk and return based on your financial goals and risk tolerance. By spreading your investments across different asset classes, you reduce the impact of market volatility on your overall portfolio. This diversification helps you weather market downturns and capitalize on market upswings. Rebalancing your portfolio periodically is essential to ensure that your asset allocation stays on track. Over time, changes in the market value of your investments can cause your asset allocation to drift away from your target percentages. By rebalancing, you sell assets that have become overweighted and buy assets that have become underweighted, bringing your portfolio back in line with your desired allocation. It's important to remember that your asset allocation should be based on your individual financial situation and investment goals. Factors such as your age, risk tolerance, investment timeline, and financial objectives all play a role in determining the right mix of assets for you. While it can be tempting to follow the latest investment fad or try to beat the market, sticking to your asset allocation is a time-tested strategy for long-term success.
  1. Maintaining your asset allocation is a key principle of successful investing. By creating a diversified portfolio, rebalancing regularly, and staying true to your investment plan, you can increase your chances of achieving your financial goals over the long term.
  2. Open in app
    The road to your goals is in your pocket! Download the Oter App to continue reading your Microbooks from anywhere, anytime.
Similar Posts
Invest in companies with strong competitive advantages
Invest in companies with strong competitive advantages
The concept of investing in companies with strong competitive advantages is a fundamental principle for any intelligent investo...
Stay informed about market trends and economic conditions
Stay informed about market trends and economic conditions
It is crucial for investors, especially beginners, to keep themselves updated on market trends and economic conditions. By stay...
Patience is a virtue in the investment world
Patience is a virtue in the investment world
Investing in the stock market requires a great deal of patience. This is because the market is inherently unpredictable, with p...
Costs matter when it comes to investing
Costs matter when it comes to investing
The impact of costs on investment returns cannot be overstated. The simple truth is that costs matter when it comes to investin...
Identify undervalued markets for investment opportunities
Identify undervalued markets for investment opportunities
Identifying undervalued markets for potential investment opportunities is a critical aspect of successful investing. It require...
Identify the ultimate guide to winning in the stock market
Identify the ultimate guide to winning in the stock market
The ultimate guide to winning in the stock market is not just about picking stocks at random and hoping for the best. It requir...
Financial modeling helps forecast future financial performance
Financial modeling helps forecast future financial performance
Financial modeling is a crucial tool for understanding a company's future financial performance. By creating a detailed model t...
Building wealth is a gradual process that requires patience and perseverance
Building wealth is a gradual process that requires patience and perseverance
Building wealth is not a quick fix or an overnight success story. It is a slow and steady journey that demands time, effort, an...
High levels of consumer debt can lead to economic instability
High levels of consumer debt can lead to economic instability
When consumers carry high levels of debt, they are essentially spending money they haven't earned yet. This can create a false ...
Invest in companies that are financially stable
Invest in companies that are financially stable
One of the key principles to consider when selecting companies to invest in is their financial stability. This means looking at...
oter

The Bogleheads' Guide to Investing

Taylor Larimore

Open in app
Now you can listen to your microbooks on-the-go. Download the Oter App on your mobile device and continue making progress towards your goals, no matter where you are.