Be an “Environmentally Friendly” Investor
On April 22, we observe Earth Day, a worldwide event focusing on protecting the environment. As a citizen of this planet, you may want to take part in Earth Day activities. And as an investor, you can learn some valuable lessons from the environmental movement.
Here are a few ideas to consider:
“Recycle” proven strategies. Over the past few decades, we have discovered ways of bringing new life to objects we would have previously thrown away. When you invest, you also don’t need to discard things you’ve used before – such as proven investment
strategies. For example, one tried-and-true technique is to simply purchase investments appropriate for your needs and risk tolerance, and then hold these investments until either your situation changes or the investments themselves are no longer the same as when you bought them. (To illustrate: You might have bought stock in a company whose products or services are not as competitive as they once were.)
Avoid “toxic” investment moves. Since the first Earth Day in 1970, we have had some success in identifying and eliminating toxins in our air and water. You can also find – and avoid – “toxic” investment moves. One such move is chasing a “hot” stock. By the time you hear about this stock – from a friend, relative or even a television or internet commentator – it may already be cooling off. Even more importantly, it might not be suitable for your needs, either because it’s too risky or because you already own several similar stocks. “Hot” stocks aren’t so hot if they aren’t right for you.
Reduce “excess” investments in your portfolio…
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