What’s the best way to invest?

Buy low and sell high. If it were only that easy. This strategy makes 100% sense on paper, the problem is, it is difficult if not impossible to implement. We always seem to do the exact opposite. We buy technology when it reaches its peak and we avoid buying equities after a market correction. Why? Well, we tend to want to do what everyone else is doing, that’s why. To be successful, you’d have to go against the grain and do the exact opposite of what everyone else is doing. Our human emotions and insecurities stop us from taking what we perceive as a risk, when in fact it would be less risky to actually do the opposite of the herd. Without a truly disciplined approach, this process is hard to implement effectively.

So how about the buy and hold strategy? There are many in the financial industry, including mutual fund companies that preach the benefits of buy and hold. The problem here is that there will always be good products and bad products. A good product today may not be a good product tomorrow as the economy evolves and sectors go in and out of favour. What about the newly created product that becomes available tomorrow? Wouldn’t it make more sense to sell one of your bad products to buy the new one? Buy and hold forces you to stay invested during downturns in markets, which may be good, but it doesn’t allow for taking advantage of changing and evolving markets.

Then there’s market timing. This could be the most dangerous and costly strategy of them all. True there are the select few who have had success timing the markets, but it means you have to be right twice. You have to know when to get out of the market and you have to know when to get back in. If you are timing either one of these can have a huge negative impact on the overall performance of your investments. As far as we know, there is no crystal ball that can help you out here.

So what is the answer? First and foremost is a disciplined strategy. Most of us don’t have the time, the knowledge or the backbone to adhere to the proper investment strategy. Luckily there are resources such as portfolio4less.com to do the hard work for you. With portfolio4less.com you benefit from the best research available as well as a proven investment formula that will help reduce the risk, increase returns and keep you focussed on your investment goals. Portfoli4less.com does not market time or believe in a buy and hold strategy. While buying low and selling high is a goal, due to an approach to investing that removes human emotion, it takes a backseat to asset allocation. Asset allocation has been proven to contribute to 80 or 90% of an investment portfolios performance. To be more specific, dynamic asset allocation, which incorporates a changing allocation, which fluctuates and rebalances with changing markets.

An investment strategy such as the ones that portfolio4less.com provides is the best way to invest.