“Playing” the Market
This week’s Barron’s cover story is about “playing” emerging markets. Story headlines in other publications are about “playing” the bond markets, alternatives, options, hedge and venture capital funds and even the stock market. I get a queasy feeling when I see these headlines. Financial markets are “played” by those seeking quick profits and who, in some respects, like to gamble. However, those looking for long term financial security should not “play” – they should invest carefully. The stakes are too high for mistakes, short term maneuvers, or gimmicks.
Average investors need to treat the markets very seriously – as if their lives depended on it, which it does because the difference between being financially secure or not will determine how you live the rest of your life, whatever age you are.
Nothing about investing should be “played.” Everything you invest in should be carefully and thoughtfully planned, considered and measured about how it brings you closer to your goals. The first step in any plan is to have a plan. Next, factor in risk, diversification, growth, effects of inflation, safety of principal and sustainability of cash flow, tax efficiency, fees and costs, and get the education, awareness and time to pay attention to what you have, are doing and whether you are on target with your goals, or hire an appropriate professional to assist you.
Investing is not a playtime activity. Treat it with the seriousness it deserves – your life depends on it!
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