Happy Friday. The big winner this week? DEI. Not the DEI you’re thinking about. No, DEI as in diversified equity investments.
What did you think I meant?
That’s right, diversified equity investments. And you can add to that the two other legs of this stool: patience and compound interest.
In other words, being well-balanced or well-rounded is a thing.
A Balanced Fund Approach
Look at how some balanced funds performed over the past few days compared to the major all-equity indices.
The Importance of Diversification to Your Asset Allocation
Times of volatility in the market often remind investors of the importance of diversification in their asset allocation. The last few days have seen some heightened volatility, and while stocks have been on a tear for what feels like a long time, you can see the benefits of a diversified asset allocation.
Diversification and Patience: Put One Foot In Front of the Other
We all know the tenets of diversification: not having all our eggs in one basket. We know that patience is about controlling one’s emotions, especially in times like these. And compound interest is about letting time do its magic.
Exhibit A is Dick Young, who reminds me, “Survival Guy, I’ve made more money in the last ten years than I ever have.”
No one said this would be easy, though. It’s easy to write. Harder to do.
But my phone isn’t lighting up. My inbox isn’t any more loaded than it usually is, and, as always, it’s mostly me calling or emailing you to check in and talk about what’s going on in your neck of the woods.
Warren Buffett once said that putting one foot in front of the other and just showing up to work can do wonders. Many of you know that to be absolutely true. You saved ‘til it hurt and lived within your means. And now you have something to show for it.
This Isn’t the First Challenge for Markets
When emotions are running high, understand there have been times similar to this before when volatility has been fierce. And you just don’t know how long it will last, and it’s not always easy.
Action Line: Are you comfortable with your current strategy? Want to talk about it? Email me at ejsmith@yoursurvivalguy.com.
Originally posted on Your Survival Guy.
