COMMON STOCKS AND UNCOMMON PROFITS SUMMARY (BY PHILIP FISHER)
Conservative Investing Strategies
Conservative investing strategies involve investing in lower-risk assets with the intention of preserving capital rather than attempting to achieve higher returns. The goal of conservative investing is to minimize the risk of capital loss while still providing a return. This strategy is popular among people who have a low risk tolerance, such as retirees and those close to retirement.
Conservative investing strategies can include investing in a range of asset classes, including bonds, money market funds, conservative mutual funds, and dividend-paying stocks. Investors may also consider index funds that track a specific index. It is important to diversify investments across asset classes to reduce the risk of loss due to market volatility.
Bonds
Bonds are a type of debt security, meaning that the issuer (e.g., government or corporation) promises to repay the principal amount of the bond plus interest after a certain period of time. Bonds are generally considered to be less risky than stocks, and they offer a steady stream of income in the form of interest payments. Government bonds, also known as Treasuries, are typically considered to be the safest type of bond.
Money Market Funds
Money market funds are a type of mutual fund that invests in short-term debt securities such as Treasury bills and certificates of deposit. They are generally considered to be low-risk investments, as the underlying investments are considered to be safe. Money market funds offer a relatively high level of liquidity, meaning that it is easy to convert the fund into cash.
Conservative Mutual Funds
Conservative mutual funds are a type of mutual fund that invests in a variety of assets, such as bonds, money market funds, and dividend-paying stocks. These funds are managed to minimize risk, and they typically have a low turnover rate (i.e., the fund manager does not buy and sell securities frequently). Conservative mutual funds can provide a steady stream of income, as well as potential capital appreciation.
Dividend-Paying Stocks
Dividend-paying stocks are stocks of companies that pay a portion of their profits to shareholders in the form of dividends. These stocks can provide a steady stream of income and can offer capital appreciation potential. Dividend-paying stocks are generally considered to be less risky than other types of stocks, as the dividends provide a cushion against market volatility.
Index Funds
Index funds are a type of mutual fund that tracks a specific index, such as the S&P 500 or the Dow Jones Industrial Average. Index funds are low-cost and low-maintenance investments, as the fund manager does not need to actively manage the fund. Index funds are typically considered to be lower-risk investments than actively managed funds.
Key Points:
• Conservative investing strategies involve investing in lower-risk assets with the intention of preserving capital rather than attempting to achieve higher returns.
• Bonds, money market funds, conservative mutual funds, dividend-paying stocks, and index funds are all considered to be conservative investments.
• Diversifying investments across multiple asset classes can help to reduce the risk of capital loss due to market volatility.
People Also Ask:
Q: What is the difference between conservative and aggressive investing?
A: The main difference between conservative and aggressive investing is the level of risk involved. Conservative investing involves investing in lower-risk assets with the goal of preserving capital, while aggressive investing involves investing in higher-risk assets with the goal of achieving higher returns.
Q: What is the best conservative investment?
A: The best conservative investment depends on the individual investor’s goals and risk tolerance. Generally, bonds, money market funds, conservative mutual funds, dividend-paying stocks, and index funds are all considered to be conservative investments.
Q: Are index funds a good investment?
A: Index funds are typically considered to be lower-risk investments than actively managed funds, and they are also low-cost and low-maintenance. Therefore, index funds can be a good option for those looking for a conservative investment.
Conservative Investing Strategies – 6 Tips
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In this animated video summary of Common Stocks and Uncommon Profits, I will reveal my favorite advice from the master of growth stock investing – Philip Fisher.
Learn to invest like the world’s greatest – Warren Buffett: http://bit.ly/2RT5per
Top 5 takeaways from Common Stocks and Uncommon Profits:
0:00 Intro
00:10 1. Fisher’s 15 points checklist
04:16 2. The Scuttlebutt method
06:40 3. Unconventional wisdom 1: Dividends don’t matter
09:32 4. Unconventional wisdom 2: You are diversifying too much
11:46 5. Fish in the right pond
TL;DW:
– An investment should tic most of Philip Fisher’s 15 points checklist to be considered a great growth stock
– Use “Main Street” resources, such as suppliers, customers, trade associations and former employees to beat Wall Street in the stock picking game
– Look for companies that have great confidence in their businesses, where money is being reinvested in productive activities, rather than being dealt out in dividends
– How to invest in stocks? Don’t diversify too much – the more companies you own, the less you know about each of them.
– One of the most important investing strategies that you can learn about is filters. There are so many opportunities out there – but so little time.
My goal with this channel is to help you make more money and improve your personal finances. How to become a millionaire? There are many ways to get there – investing in the stock market, becoming a stock trader, doing real estate investing, or why not becoming an entrepreneur? But whether you are interested in how to invest in stocks or investing strategies for creating passive income with rental properties – I hope to be able to provide you with a solution (or at least an idea) here. Warren Buffett – the greatest investor of our time – says that you should fill your mind with competing ideas and then see what makes sense to you. This channel is about filling your mind with those ideas. And in the process – upgrading your money-making toolbox.
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