What Is Your Investment Style?
Posted By George on December 10, 2009
Knowing what your risk tolerance and investment style that will help you select a better investment. While there are various types of investment that can be made, there are only three specific investment styles – styles and three series with your risk tolerance. The three investment styles are conservative, moderate, and aggressive.
Natural, if you find that you have to lower the risk tolerance, your investment style will most likely be conservative or moderate at best. If you have a high tolerance for risk, you will most likely be or is being aggressive investors. At the same time, your financial goals will also determine what style of investing you use.
If you are saving for retirement in the early twenties, you should use a conservative or moderate style of investing – but if you are trying to get together money to buy a home in the next year or two, you want to use the aggressive style.
Conservative investors want to maintain the initial investment. In other words, if they invest $ 5000 they want to make sure that they will get the initial $ 5000 back. This type of investor usually invests in common stocks and short-term bonds and money market accounts.
Coupon rate of interest is that you will receive when the bond until maturity. This figure is written as a percentage, and you must use other information to find out what akan interesting. A bond with a par value of $ 2000, with a 5% coupon rate will be $ 100 per year to reach maturity.
Bonds because they are not issued by banks, many people do not understand how to go about buying one. There are two ways this can be done.
You can use a broker or brokers to buy the company for you or you can go directly to the Government. If you use a broker, you will more likely be charged a commission fee. If you want to use a broker, for the lowest commission around!
Purchase directly through the Government is not nearly as hard as it once. There is a program called Treasury Direct which can be used for the purchase of bonds and bond you will be held in one account, you will have easy access. This will allow you to avoid the use of brokers or broker companies.
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