What is your asset allocation & diversification strategy? If your not familiar with those terms don’

• 06/30/22

What is your asset allocation & diversification strategy? 👀If your not familiar with those terms don’t worry. This post contains almost all of the definitions you need, infact, 80% of this post is just definitions 👇 💙Asset allocation “Asset allocation refers to the strategy of dividing your investments among different asset categories, such as stocks, bonds, real estate, cash, and cash alternatives. Asset allocation aims to control risk by diversifying an investment portfolio.” 💙Diversification “The idea behind diversification is that having a variety of investments will yield a greater return while assuming lower risk. One way to practice diversification is to create your portfolio of stocks. You can do this by investing in companies you believe in, and using a combination of first-hand knowledge on a category, additional research, and insights gleaned from trusted friends and experts. Public is the first social investing app, which means that its users can see investments made by people in their network and start conversations and learn from the people they trust.” Ways to increase diversification👇 💙 Instant diversification “When you invest in a mutual fund (or ETF) you’re able to invest in multiple assets with a single purchase. This diversification makes you a more resilient investor by virtue of the fact that all your eggs are no longer in one basket.” 💙 Time savings “Not only do you build a diverse portfolio with a single transaction, but you also save time since the mutual fund is managed by professionals.” 💙Mutually Traded Funds “A mutual fund is a cornucopia of investments. They save you the hassle of having to choose stock and bonds. Instead, you can buy a mix of stocks and bonds as a diversified package that has already been assembled for you. This is a less risky investment with less dramatic upside. Some mutual funds are overseen by professionals while an index fund is designed to mirror a specific stock market index, like the S&P 500. Index funds cost less since they cut out the supervisor. 401(K)s tend to be curated investments with no minimum, but if you plan to do your own investing there may be a minimum.” 💙 S&P 500 index funds “If you’re a long term investor, you can always invest in an S&P 500 index fund (or a comparable ETF) . This will allow you to invest in hundreds of the most successful companies with a single purchase. If you want further diversity in your investment portfolio you can always seek out other opportunities down the line.” 🫶 this post basically wrote itself, I found all of the definitions above at https://public.com/learn/investing-glossary. ⚠️Not investing advice, also not plagiarism because I cited my source🙃 #pocketchangeinvestments #clubDCA

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