Who doesn’t want a large investment portfolio? Everyone does, but you have to remember that it doesn’t happen overnight. Experts like Hubert Moore says that you need to save money regularly, continue to invest consistently and then figure out how to stay the course for as long as it takes. However, this is not all that you have to do. There are a number of investment strategies that can come in handy for improving your investment returns over time. What are those strategies?
Hubert Moore has highlighted some of them below for you to try out:
- Look for lower cost ways to invest
When you are making money, it can be very easy to ignore the investment expenses. But, these expenses can add up over time and this is not good. As a matter of fact, Hubert Moore asserts that lowering the expenses by just 1% can make a big difference in your investment portfolio’s performance in the long-term. In order to find the lowest fee possible, you should search for an online broker that can offer you lower transaction costs. Rather than investing in individual securities, you can go with funds.
- Take diversification seriously
Every investor should know the importance of diversification, but the concept gets lost in bull markets when you are making money, similar to investment expenses. After all, if you increase your stock allocation in a rising market, it does give your portfolio performance a solid boost. But, this only happens until the bull market last and once they fall, you could end up losing. Hence, Hubert Moore says that no matter how well your stock allocation appears to be doing, you need to maintain the appropriate percentages in both cash equivalents and fixed income investments of your portfolio.
- Rebalance regularly
The purpose of rebalancing is to return your portfolio to the original level of diversification. According to Hubert Moore, this doesn’t just apply to bull markets when you are increasing your investments because the markets are rising; it also applies to bear markets in case you have reduced your investments due to a falling market.
- Benefit from tax efficient investing
Similar to investment expenses, your portfolio can be significantly affected by income taxes applicable on your investment earnings. While you cannot completely eliminate income taxes, Hubert Moore says that it is possible for you to minimize investment taxes wherever you can. Avoiding heavy trading is one of the best ways to accomplish this. Trading leads to capital gains and capital gains leads to capital gains taxes. Combine them with trading fees and your portfolio may not perform all that well.
- Don’t listen to the ‘experts’
One of the most important things that Hubert Moore suggests is that you should ignore experts that are confidently predicting when the market will go up or down. These ‘experts’ are simply crystal ball gazers, which means they have as much insight as you about there the market is heading. Plus, they are not harmless either because they are dealing primarily in hyperbole, which means they can grab your attention easily. Learning how to tune out this kind of talk is of the utmost importance to succeed as an investor.
- Continue investing no matter what the market does
There can be dramatic growth in a portfolio that’s growing via a combination of regular contributions and investment gains. As per Hubert Moore, the direction of the market should never affect your contributions, but this is exactly what happens sometimes. People often hesitate to continue investing in both bull and bear markets. But, continuing to invest in a bull market will give you higher returns. Doing so in the bear markets can actually minimize the decline in your portfolio, so you should not stop investing because the market will eventually start moving up once more and that is when you will see the benefits of being consistent.
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