- Don't compete with big guys. They are always faster.
- It is not necessary true that long term broad investment will grow on average.
- Missing the good days on market will likely negate all the earnings.
- News are not always new.
- Calm days just like the weather tend to cluster with calm days.
- Outperforming investment funds are not a good investment.
- Mutual funds with high fees rarely beat the market and mostly underperform.
- Commissions add up. The more you trade the worse you do
- Sell losers for tax benefits. Can deduct up to 3k from regular income.
- Diversify the portfolio with glabal market funds.
- Consider tax-managed funds if you fall under high-text bracket.
A sample low-risk portfolio allocations
- Cash 5%
- Bonds 27.5% VBIIX 7.5% VGOVX 7.5% VDIGX 12.5%
- Real estate 12.5% VGSIX or FRESX
- Stocks 55% VTSMX 27% VTIAX 14% VEMRX or FEMKX 14%
