BUYandHOLDER Update (2/16/01):
Dear BuyandHolder,
I'm pleased to announce that US News & World Report (12/4/00) and
Forbes (2/9/01) have rated BUYandHOLD "Best of the Web" for online
investing. For complete reviews, go to:
usnews.com
forbesbest.com
WHEN BUILDING YOUR PORTFOLIO -- DIVERSIFY!
As a BuyandHolder, you've already taken the most important step
towards a brighter financial future for you and your family --
your commitment to a long-term investment plan. To help keep your
plan on track through up and down markets, why not make the most
of your BUYandHOLD account and try to capitalize on today's
uncertainty by diversifying your portfolio? It's the next most
important step towards fulfilling your investment goals.
THE RIGHT WAY TO DIVERSIFY YOUR INVESTMENTS
Last year, many investors who owned only stocks of technology and
large US companies learned the hard way that diversification is an
essential component of a long-term investment plan. A properly
diversified portfolio can reduce overall risk and increase your
investment opportunities because you're buying a variety of
companies, based on factors such as size, products, services, and
industry, that are not likely to move in the same direction at the
same time. So if your technology and industrial holdings are going
through a rough period, perhaps consumer goods,
telecommunications, a foreign company, or even Index Shares can
help boost your overall returns.
Diversifying by "market capitalization" (spreading your
investments among large-, medium- and small-sized companies) and
by "market sector" (buying companies in different industries) have
been recent Bulletin themes. BuyandHOLD makes it easy to find
individual companies and Index Shares by size and industry. Our
Research Stocks channel lists over 4000 securities in 12 different
categories and nearly 40 Index Shares to help you diversify your
investments the right way. Go to:
buyandhold.com
WHY DIVERSIFY TODAY?
Historically, down markets have provided excellent investment
opportunities for long-term investors. After the bear markets of
1962, 1969/70, 1973/74 and the crash of 1987, the Dow Jones
Industrials Average rebounded from its lows by more than 20% after
one year and more than 50% after two years! Declining interest
rates have also often had positive effects on the stock market.
The Federal Reserve Board has cut interest rates to stimulate the
economy in 14 different periods since 1954. Within 12 months of
the first rate cut in all but one of these periods, the S&P 500
increased, including double-digit price changes in 11 out of the
14 periods. While past performance does not guarantee future
results, down markets and Fed easing may offer compelling reasons
to increase your investment opportunities while minimizing your
risk through diversification strategies. (Sources: For the Dow,
"Contrarian Investment Strategies: The Next Generation" by David
Dreman and for the S&P 500, TheStreet.com's "Look at the Facts
About Fed Eases," with data provided by Baseline.
GET THE MOST OUT OF YOUR BUYandHOLD ACCOUNT
There are several ways to build a diversified portfolio at
BUYandHOLD, but here's the most convenient and affordable way to
maximize the advantages of BUYandHOLD:
- Switch to our Pay Per Month plan so you can buy as many stocks
as you want for a flat fee of just $9.99 per month.
- Buy shares on a regular basis automatically with our E-ZVest
service, to take advantage of dollar cost averaging strategies.
- Fund your account with BUYandHOLD Instant Deposit, a link from
your bank account to your online account, or Direct Deposit from
your paycheck, so you'll never need to send another check.
- If you haven't started your investment plan yet, complete your
application online with E-Signature and fund your account through
BUYandHOLD Instant Deposit so you can buy stocks today.
Please read the following articles for more detailed discussions
of the fine points of investing, as well as a few very timely
financial planning tips, and join me here again in a few weeks for
more on building your portfolio.
VISIT www.buyandhold.com FOR MORE TIMELY INVESTING TOPICS:
Our financial planning partners at DirectAdvice expand on the
topic of diversification with the answer to "How Often Should You
Re-Balance Your Portfolio?". Go to:
buyandhold.com
Best-selling financial author Chuck Carlson reminds us that great
wealth can be created over time by earning "just" 11% a year in
his article, "Building Wealth at 11% Per Year." Go to:
buyandhold.com
When dealing with the IRS, it's important to get it right the
first time, so visit our Set Your Goals channel for a check list
on "How To Prevent a Tax Audit." Go to:
buyandhold.com |
