Risk Management Investing


There has never been a time in the financial markets that have allowed individual investors the opportunity to take advantage of a myriad of investment choices to reduce risk and increase returns.  

First, a study done in Financial Planning Magazine July 2011 illustrates by adding alternative assets to your porfolio like commodities or REITS, not only decreases risk over time but can help increase your returns over time as well.  This is because these asset classes are not correlated to the market.  Second, The University of Chicago published a study illustrating (illustrated in Dorsey Wright on June 17, 2008) that 49% of an investment's move is based on the performance of the sector it is in and 31% of an investment's move is based on the performance of the market.  Therefore, you have an 80% probability of making money just by being in the right sector while the market is going up.  Most investors focus too much of their time on how the company is doing.  Lastly, I advise my clients when the markets are over valued as well as undervalued.  This allows them to raise cash or invest their cash depending on the market conditions.  

In summary, There are many investments to help reduce risk in an investment portfolio.  I take great pride in educating my clients about risk management investing strategies. 


There are risks involved in investing including market fluctuation and possible loss of principle value which may not be suitable for every situation.  Past performance is no guarantee of future results.