All Your Eggs in One Basket 

 

According to the proverb, all of your eggs in one basket is not a good thing. Diversification is a good guideline for many things in life, but especially investing. Investment professionals generally recommend that your assets be allocated into several different investment classes, usually stocks, bonds, and money markets.

As a general rule, the younger you are, the more risk you can afford, meaning that more of your money should be in the stock market. This is because you will have a longer time to recover should the market experience any setbacks.

As you approach retirement age, your goal will shift to preserving capital. At this point, it is suggested that more of your assets be shifted to bonds and money markets. Over time, your portfolio should be reviewed. However, shifting assets too often can be detrimental as well. You may need the help of a qualified financial advisor who can explain to you the advantages and risks of each type of investment vehicle.

By keeping all of your eggs in many different baskets, you will maintain your potential for a return on your investment, while protecting you from loss. If one class does not perform as you expected, you still have the others to buffer any loss. 


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Tom Kile and Darrell Nipp are your Amarillo real estate experts!
Tom Kile & Darrell Nipp
3440 Bell, Suite 100
Amarillo, TX 79109
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