Stop Chasing A Unicorn!!

In Blog by redsocks

It’s time to move into Safe – Tangible – Property Investments.

There are many half-truths perpetrated on individuals by The City & Wall Street to sell product to clients, gain assets, etc.

However, if individuals took a moment to think about it, the illogic of many of these arguments are readily apparent.

Chasing an arbitrary index that is 100% invested in the equity market requires you to take on far more risk that you realize.

Two massive bear markets over the last decade have left many individuals further away from retirement than they ever imagined.

Furthermore, all investors lost something far more valuable than money – the TIME needed to achieve their goal.

To win the long-term investing game, your portfolio should be built around the things that matter most to you.

Capital preservation
A rate of return sufficient to keep pace with the rate of inflation.
Expectations based on realistic objectives. (The market does not compound at 8%, 6% or 4% every year, losses matter)
Higher rates of return require an exponential increase in the underlying risk profile. This tends to not work out well.
You can replace lost capital – but you can’t replace lost time. Time is a precious commodity that you cannot afford to waste.
Portfolios are time-frame specific. If you have a 5-years to retirement but build a portfolio with a 20-year time horizon (taking on more risk) the results will likely be disastrous.

The index is a mythical creature, like the Unicorn, and chasing it has historically led to disappointment. Investing is not a competition, and there are horrid consequences for treating it as such.

So, the next time a financial professional encourages you to just “buy and hold” for the long-term, maybe you should question just whose “yacht” are you buying?

Call H&G we love to chat.

TT.