Winning the Arguments about Market

It’s simple really. Just change the time horizon so it suits your stance.blog

I’ve seen this play out over everyone’s favorite yellow metal the past few years. Gold is down almost 40% since it peaked in 2011. But it’s still up almost 350% since 2000. Although since 1980, on an inflation-adjusted basis, it’s basically flat. However, since the early-1970s it’s up over 7% per year (or about 3.4% after inflation).

See what I did there? There’s ammunition for both sides of the gold trade to use to their advantage. Continue reading “Winning the Arguments about Market”

Higher the risk Higher the return

The risk/return trade-off could easily be called the “ability-to-sleep-at-night test.” While some people can handle blogthe equivalent of financial skydiving without batting an eye, others are terrified to climb the financial ladder without a secure harness. Deciding what amount of risk you can take while remaining comfortable with your investments is very important.

In the investing world, the dictionary definition of risk is the chance that an investment’s actual return will be different than expected. Technically, this is measured in statistics by standard deviation. Risk means you have the possibility of losing some or even all of our original investment. Continue reading “Higher the risk Higher the return”