Investment Strategies

Friday, January 1, 2010  //  0 Comments  //  Financial Guides

It’s wise to consider developing strategies for both short-term and long-term investments.   Investing randomly fails to generate the best returns, but strategizing to make investments work together helps achieve a better outcome for your portfolio.

Seeking the guidance of financial professionals enables you to coordinate your investments and make smart decisions about what to buy and when to sell.  Four Brothers Financial, LLC. is staffed with experts prepared to assist you with those decisions.

It’s important to discuss strategies with a professional, since some strategies can be risky.  Finding the right investment strategies is an individualized process, tailored to your personal needs.

Some possible short-term strategies include:

• Choosing stocks instead of cash investments
• Buying on margin
• Short-selling

Ultimately, strategizing contributes to long-term portfolio returns.   To maximize portfolio success, you may want to consider the following long-term investment strategies:

• Buy and Hold: With this strategy, you’ll buy stocks from established, reputable companies, with the expectation that you’ll hold these stocks for years, seeing an eventual long-term gain.
• DRIPs: Commonly known as dividend reinvestment plans, DRIPs allow you to reinvest dividends into additional stocks from that company.  This investment strategy allows you to take advantage of compound interest.
• Laddering: When investing in bonds, laddering allows you to divide your investment among several bonds with different maturation dates.  As the bonds mature, you reinvest the principal, maintaining the staggered maturation dates, or you could chose to invest in another type of asset.
• Reinvest fund distribution: With this strategy, you’ll invest in a mutual fund and then direct earnings back into the fund.  If you’re nearing retirement age, you could choose to have the earnings paid to you directly.
• Tax-deferred or taxable: Depending on your circumstances, you may benefit from a tax-deferred account, in which taxes are charged upon withdrawal of the money, or a taxed account, in which taxes are charged immediately.

Since investment choices are complicated, professional consultation is crucial when making decisions.  The staff of Four Brothers Financial, LLC. understand investments and how to personalize strategy for best returns.  Contact us to discuss how we can help you.