I am in a number of groups with individual investors.
I learn a lot from others.
But one thing I see is a lot of folks don’t diversify.
Some are all into real estate.
Some are all into mutual funds.
Of those into mutual funds some are all into one fund (meaning they are all in on one part of the economy).
I even recently read a post of someone who owns a pile of SpaceX stock that doesn’t want to sell it because SpaceX might get even more valuable.
Yet the investing greats will tell you to diversify your investments.
Why? Because markets shift.
I can find 100’s of videos saying the stock market is about to go way up. And 100’s saying it will go down.
Same with investing in real estate. Some say now is the time to get in and others say now is the time to get out.
And it is really a confusing time. As we’ve discussed before so much of the economy today is about how the government will intervene to push the market in certain directions - which is virtually impossible to predict.
But diversification goes beyond your investment dollars.
It also applies to your income streams.
Most of us working have one employer. If you have a traditional 9 to 5 it’s generally smart advice to not have a ton of stock in your employer. Because if your employer has financial issues and you lose your job you don’t want your investments wiped out too.
For those of us that own the employer that employs us it is smart to think about how to get more income streams. More clients. More types of work.
For instance could you make money from professional services, speaking and books? This type of diversification let’s you ebb and flow if the market shifts.
With all of the uncertainty to day I think it’s a smart time to be very diversified.
There’s a temptation to concentrate - especially if an investment or income stream is doing well. But what if something goes the other direction?
I am not your financial advisor, but it’s food for thought. And these are definitely topics to take to your financial advisor.
How diversified are you?
How diversified do you want to be?
Shawn
R. Shawn McBride
300 N. Ronald Reagan Blvd., Suite 210
Longwood, Florida 32720
(by appointment only)
Get in touch: https://linktr.ee/ourshawnmcbride
NOTE: While legal issues are discussed this is education and is not legal advice. It is not a substitute for the advice of an attorney. Please consult your own attorney on your situation and to get legal advice about your circumstances. Courts are unpredictable and may disagree with the author’s opinions.
Unless expressly stated otherwise statements are the opinions of the author and may or may not come true. Consult your advisors before making or refraining from any actions.
This is a business article by McBride For Business, LLC which is separate from the law firm of The R. Shawn McBride Law Firm, PLLC. McBride For Business, LLC offers business consulting, conference speaking, training and other non-legal services.
This is not financial, legal or investment advice.