In the ever-evolving landscape of investment management, the role of conventional investment managers remains crucial and indispensable. While new technology and digital platforms have gained prominence and greater usage in recent years, conventional investment managers bring a unique set of skills and expertise that cannot be replicated by automated systems.
Experienced investors will almost always have a balance in cash and/or cash equivalents (like 90-day treasury bills or other money market investments) as part of a well-diversified investment portfolio.
On a day-to-day basis, holding cash or cash equivalents can provide some form of relief should unforeseen expenses arise. From an investment perspective, viewing cash as part of your asset allocation allows you to hold a defensive cash position and enables swift offensive portfolio purchases, relative to investment market movements.
Passive income is money that you earn without too much effort on your part. It does not include employment income or income you may derive from a side business that requires significant physical or mental energy.
Passive income should require little or no daily effort to maintain.
That being said, you do have to do some initial work to develop a passive income strategy and set it in motion. Some may think that passive income requires little or no effort to set up. However, it does require planning and often an upfront investment.
Long-term investing focuses on achieving a favourable rate of return over a predetermined holding period while ignoring short-term market volatility.
Attempting to time the market does not reliably lead to higher returns. It is time in the market that results in greater investment success.
Investing is something that should be part of your everyday life. It may be as simple as leaving your money in a company retirement plan or as complex as attempting to actively manage your own stock portfolio.
However you invest your money, there are common mistakes that most investors fall prey to but that you can easily avoid with proper planning and application.