3 Investment Principles

3 Investment Principles that have Withstood the Test of Time



You can’t control stock market movements or the economy, but you can control what you do with your money. A long-term perspective will help you stay focused on your goals and weather market fluctuations.


To improve your odds of success, focus on what you can control. Here’s how to make smart investment decisions:


Diversify your portfolio

Owning a variety of investments helps smooth out any bumps in the road. For example, if the stock market takes a dive, your bond assets may cushion the fall. Likewise, when interest rates are low and bonds are paying a pittance, stocks can boost your returns.


Own only quality investments.

Quality is more than just an investment’s potential to pay off. It also includes its likelihood to be around tomorrow — and beyond — as well as its record of paying dividends or interest reliably over time.


Maintain a long-term perspective.

Time in the market is more important than timing the market. Investing for short periods — even if it gives you a better chance of beating the market — isn't a good strategy because short-term investing tends to be more risky than longer-term investing. Keep your eye on the long term and don't try to time the ups and downs.


Stocks for the Long Run Jeremy Siegel

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