Be a Worry-Free Long-Term Investor

Saving for retirement is a long-term process that we need to visit our portfolio and evaluate the fundamental investment strategy every 6 to 12 months.  The day to day market fluctuations don't matter but it is important to see and analyze the big picture.



Re-balance your asset allocations if your level of investment risk has changed.  That risk tolerance changes depending on your personal financial situations.

Every asset class has its strengths and weaknesses. If your portfolio is well diversified, you are in a good position to weather through the market whether it's good or bad.  For example, when growth stock funds are performing well, value funds may be so so.  When stock funds are going through a tough time, bond funds typically do well. Over time, a well-diversified portfolio can increase the earning power while decrease risks.

To time the market is useless and difficult.  Dollar cost averaging is our best friend.  Simply saving and investing in the market at a regular interval is the best strategy.  Of course, no one likes it when markets are down.  However, look at the bright side.  When the markets are down, we can buy more shares for the same amount of money as if we are shopping at Target.

No idea whether the markets are going up or down?  I use this simple method to balance my portfolio.  When the markets are up, I do 80% stocks and 20% bonds, and vice versa.  Here's how.



There is really no need to listen to those so-called experts yapping all day on CNBC.  The S&P chart tells a great story.  I use a weekly bar chart.  From 2013 until mid-2015, the markets were doing great.  There was no need to re-balance anything.  Then, from the 2nd half of 2015 to the Spring of 2016, I was heavy in Bonds and wanted to stay on the side line.  After that, the markets took off again.  Simple and worry-free.  If your portfolio is tech heavy, you may use the NASDAQ chart instead.


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