| How have your investments been doing over the last | | | | high performance under hundreds of criteria -- and if |
| year or two? Probably not so well. Would you like a | | | | any of them should stop performing well, they're |
| way to prevent a repeat performance? Read on to | | | | dropped from the portfolio. |
| find out how the absolute return approach to investing | | | | 3) Buy & Hold |
| can help you grow your money quickly -- yet safely. | | | | It sounds so noble: Buy and hold! Don't be swayed by |
| There are three reasons why people lose money in | | | | the scary gyrations of the market! Hang in there! |
| the stock market, all of which are reduced or | | | | Show some courage and faith! |
| eliminated by absolute return investing: Emotional | | | | Ouch! That's how a huge amount of money was lost |
| decisions, mutual funds, and the buy & hold | | | | over the last couple of years. The problem? Most |
| approach to investing. Fortunately, the absolute return | | | | people wouldn't know when to sell if they tried. |
| investing approach has the perfect fix for all three of | | | | The absolute return investing approach, however, |
| them. | | | | hinges on making exactly those decisions, and making |
| 1) Emotional Decisions | | | | them correctly. Sophisticated computer models |
| Our gut may be reasonably good at telling us whom | | | | analyze numerous indicators and can thus predict the |
| we should fall in love with. But it's not at all good at | | | | likelihood of a recession. |
| telling us which stocks to pick. Or when to buy and | | | | There are no guessing games involved when it comes |
| when to sell. | | | | to deciding whether it's a good idea to stay in the |
| Absolute return investing takes the emotions out of the | | | | stock market or not. And neither will there be guessing |
| decision-making process. A sophisticated computer, | | | | games about when it's time to dive back in. In the |
| fed with all the right programs and analytics software | | | | meantime, the money is held in cash, ready to be |
| -- and all the data it needs -- will make the decisions | | | | deployed again as soon as it's safe. |
| for you. | | | | Where can you find absolute return investing? Find a |
| 2) Mutual Funds | | | | financial advisor who uses it as his or her main |
| Mutual funds seem so easy. You just pick some good | | | | approach. Be sure to ask your prospective advisors |
| ones, put them in your portfolio, and then you keep | | | | about their results as well. If they truly work the model, |
| your fingers crossed. However, all that ease comes | | | | their results should be superior, and they'll be proud to |
| with a big price tag. First, there are the fees that will be | | | | show them to you. If they're trying to hide behind |
| deducted from any gains -- and will still be deducted | | | | "confidentiality," run the other way. |
| from your principal even when the funds lose money. | | | | You should also ask them how they'll get paid. If they |
| In addition, most funds are pitiful underperformers even | | | | work on commission, they won't be working for you, |
| as compared to their very own benchmarks. That's | | | | and their recommendations may not be in your best |
| because even though they probably contain a few | | | | interest. Instead, look for a fee-only financial advisor |
| good stocks, they also contain a lot of clunkers. | | | | who uses the absolute return investment model and |
| Fortunately, absolute return investing will eliminate the | | | | won't try to push mutual funds. |
| clunkers from your portfolio. Stocks are selected for | | | | |