When it comes to investing in stocks, knowing your investment goal is crucial. That, along with your investment time frame and how much risk you’re willing to take when investing in the market, will help you determine how your stock investments should work with the rest of your investment portfolio.

Investing in stocks can help your investment portfolio by providing potential growth, income from dividends, or a combination of the two. However, the value of any stock can fluctuate over time so it may be worth more or less than you originally paid.

Equities & Stocks Investment | Financial Advisory and Asset Management

Develop a Diversified Asset Allocation Strategy

When selecting stocks to invest in, you should carefully consider the risk of that security and develop a diversified asset allocation strategy that fits with your goals, investment time frame, and risk tolerance.

Stocks can be attractive when they’re on sale or under valued. As the adage goes, buy low and sell high.

Other details that need to be taken into consideration include:

  • Earnings growth of the company
  • Stability and relative strength in the industry it’s in
  • Debt-to-Equity ratio
  • Price-to-Earnings (P&E) ratio
  • Company Management
  • Dividend history.

Below are recommendations (but not set in stone) for the quantity and percentages of stocks in a portfolio:

  1. Invest in approximately 20 to 30 stocks in at least six to eight sectors, with different investment characteristics.
  2. No more than 20% of the total value of your stock portfolio should be in any one sector.
  3. No more than 10% of the total value of your stock portfolio should be in any one stock.
  4. You should invest a minimum of approximately 3% to 4% of the total value of your stock portfolio in each stock.

Association Financial, LLC, and Association Financial Services, LLC, can provide you with a wide range of advisory services (whether fixed or variable investments), including:

  • Annuity selection (fixed or fixed-indexed)
  • Assistance in deciding when to buy and sell your investments
  • Review of insurance and investment portfolios, as well as transferring assets or qualified plan rollovers
  • Individual bond, commodity, equities (stocks), ESG stocks, Exchange Traded Product (ETP), investment trust, and REIT selection
  • Strategic asset allocation strategies including re-balancing
  • Attorney and CPA services
  • and much more.

Contact us here for more information.

Investing in securities involves risk of loss that clients should be prepared to bear.