Whether it’s 2011, 2012 or 2020 – here’s a good investment strategy to make money by investing without a crystal ball. Every good investment plan takes into account both the choice of investments and the time. If you can’t make money by investing with this simple strategy, rest assured that only the lucky few will make money.
Before you strive to put together a good investment strategy for 2011 and move forward, ask yourself the obvious question. Where do the most successful people invest (or where have they had in the past) to make money by investing in the long run? The answer before the financial crisis was bonds, stocks and real estate. Today, the answer for the average investor is the same and takes the simple form of bond funds, equity funds and real estate funds. After all, if all three of these investment areas are filled, we are probably depressed and only a few lucky or intelligent speculators will make money to invest.
A good investment strategy does not rely on speculation or attempts to determine the timing of markets. Whatever you hear, no one has a proven and consistent record in time that significantly exceeds the markets in the long run. If they did, they would make a lot of money by investing, and they would hide their secrets, not share them. So why not settle for a good investment strategy that makes only one basic assumption: that the United States will grow and prosper in the long run?
Investing money in the three areas above is simply with mutual funds. To reduce risk and add flexibility to your investment strategy, add a fourth type of fund called a money market fund. At today’s interest rates, this may not seem like a good investment, but they are safe and earn interest that tracks current interest rates. More specifically, by owning only 4 different funds, you can put together a good investment strategy for 2011 and then make money by investing in America’s future. From high security to higher risk and greater profit potential: a money market, intermediate bonds, high-capitalized capital gains and a real estate equity fund is all you need to own.
A good investment strategy for wetting your feet is to simply invest equal money in all 4 funds. The synchronization strategy does not require calls or assumptions. One year later and once a year after that you just move the money to make all 4 funds equal in value again. This automatically forces you to take some money off the table from your more efficient funds – and move more money to those who have also failed. The net result over time is that you buy more stocks when prices fall, you sell stocks that are relatively expensive.
This is also a good way to make money by investing in the long run while keeping a cover on risk. Simply buying and holding funds is not a good investment strategy and has made it difficult for many average investors in the past. For example, real estate funds were good investments for several years until they were hampered by the financial crisis. If you owned them and had just held them, by 2009 you could have amassed a significant amount of money and been at risk there … leading to large losses as a result of the financial crisis.
There is more to it than the simplicity of what I call a good investment strategy for 2011 and beyond. This strategy uses two of the only time-tested instruments in the investment business: BALANCE SHEET AND REBALANCE and DOLLAR AVERAGE ENVIRONMENT. The first instrument keeps you on track while keeping a risk cover, and the second is an instrument that works to reduce average investment costs by buying you more stocks when prices are lower and less when they are high.
You can put a good investment strategy together with only moderate risk by owning only 4 different mutual funds. People make money by investing in the long run with bonds, stocks and real estate; and the smart ones keep some money for a secure investment for flexibility. In the past, some people were just lucky and made money by investing without strategy. With a good investment strategy, you won’t have to squeeze your fingers and rely on luck. If America thrived in 2011 and beyond, so will you.