Investors who heeded our simple, timeless principles and followed our recommended allocations would have generated respectable returns during 2012. This is also true for longer time periods (see page 2 for hypothetical returns on our recommended portfolios).
• I will understand my own circumstances and formulate an investment plan based on my needs, not in anticipation of market trends.
• I will remind myself that investing is not a form of entertainment—if I have an urge to gamble, I will go to Las Vegas.
• I will stick to my plan.
• I will not attempt to pick winning stocks.
• I will ensure that my holdings are adequately diversified within each asset class I own.
• I will focus on minimizing my investment-related costs.
• I will stay abreast of changes in investment-related tax laws.
• I will not purchase any financial instrument I do not understand.
• I will ignore money managers or others selling products rather than advice.
• I will ignore market prognosticators.
• I will take full advantage of my qualified retirement plans by making the maximum allowable contributions consistent with my budget.
• I will hold my least tax-efficient assets in my tax-deferred accounts.
• I will rebalance my portfolio infrequently, but at regular intervals regardless of the current state of the markets.
• I will not allow the price I have paid for a security to influence my future investment decisions—except for tax considerations regarding capital gains and losses.
• At year end I will harvest tax losses simply and without deviating from my target portfolio allocations, by selling and buying index-type funds within the same asset class.
• I will appreciate the simplicity of the AIS approach; instead of worrying about factors that are not within my control, I will establish my plan and turn my attention to enjoying life.
Also In This Issue
Quarterly Review Of Capital Markets
Tax Changes: The Impact On Individual Investors
87 Years Of U.S. Stock Market Returns
The High-Yield Dow Investment Strategy
Recent Market Statistics
The Dow Jones Industrials Ranked By Yield
Recommended Investment Vehicles
To access the full article, please login or subscribe below.
Already a Subscriber?
Log in now
Get full access to the Investment Guide Monthly.Print + Digital Subscription – $59/Year
Includes 12 Print and Digital Issues
Print + Digital Subscription – $108/2 Years
Includes 24 Print and Digital Issues
Digital Subscription – $49/Year
Includes 12 Issues
Digital Subscription – $98/2 Years
Includes 24 Issues