5 easy ways to update your investment

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Properly establishing a long-term investment plan can take a lot of time and research. After all, a well-constructed portfolio will incorporate a lot of things, from your investment goals and risk tolerance to your age and financial situation. But even after all this effort, you should continue to review and update your portfolio regularly. As the world of investing is constantly changing, you need to regularly update your portfolio to keep it optimized and maximize your potential gains. Here are some ways to modernize your portfolio and make sure you don’t miss what’s new in the world of investing.

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Reevaluate your investment goals

If it’s been a while since you reviewed your portfolio, start with your investment goals. As you age and go through various life events, it is possible, if not likely, that your investment goals will change. For example, if you have just graduated and are starting a new job, you might be looking for aggressive growth. But if you’re getting married, have kids, or are approaching retirement, you may need to lower your risk profile or even switch to an income-focused portfolio. Even if your investment goals haven’t changed, reviewing them is the first step to making sure your portfolio is up to date.

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ESG Investment Research

Once you’ve defined your investment goals, it’s time to be open-minded to new investment styles or strategies that may not have been available when you created your portfolio. ESG investing is a prime example. While investors in decades past may have wanted to incorporate social and environmental issues into their portfolios, there has never been a formal mechanism to do so. In fact, it wasn’t until 2005 that the term ‘ESG’, for ‘environmental, social and governance investing’, was coined. But today, 80% of large companies follow the Global Reporting Initiatives standards and more than $3.9 trillion is invested in more than 7,000 ESG funds. In other words, ESG investing is here to stay, and it can be a great way to refresh your portfolio.

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Learn more about cryptocurrencies

Even if you don’t pay much attention to the financial press, you can’t avoid hearing about cryptocurrencies these days. While crypto isn’t for everyone, for others it can be a good speculative addition to a portfolio. Cryptocurrency is extremely volatile and its success is far from guaranteed. However, many well-known billionaires, from Mark Cuban to Elon Musk, have positive things to say about certain cryptocurrencies, and El Salvador recently became the first country to adopt Bitcoin as legal tender. The bottom line is that crypto can either be in the early innings of disruption to the global financial system, or it can just be a passing speculation that will ultimately prove worthless. Either way, it pays to educate yourself about crypto and figure out for yourself whether or not it belongs in your portfolio.

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Switch to a low cost broker

For most of the history of the stock market, investors could only buy securities through a full service broker. Traditionally, this meant in-person meetings, high commission fees, and only occasional trading. It was not until the brokerage industry was deregulated in 1975 that Charles Schwab was able to introduce reduced commissions and start the trend towards self-directed investing. These days, you can trade most stocks and ETFs online commission-free, while still having access to investment research and additional services, if needed. If you’re still stuck with a traditional high-fee broker, but want to be more active with our investments, upgrade your investment to a reputable online broker that offers commission-free trading.

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Rebalance regularly

No matter how well you build your portfolio, “set it and forget it” is a thing of the past. That doesn’t mean you shouldn’t hold stocks for the long term. Rather, it means that you shouldn’t completely forget about your wallet after building it. Things change quickly in the world of investing and it’s likely that after a year or even a quarter your portfolio will be out of whack. Assuming you still want to hold all the stocks you originally bought, rebalancing is a way to take profit from your winning stocks (i.e. “sell at full price”) and reinvest that money in positions that have underperformed (i.e. “buying low”). ”). You can also use your rebalancing as a time to eliminate stocks you no longer want to own. Regular rebalancing is one of the best ways to keep your portfolio fresh and up to date.

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About the Author

After earning a BA in English with a major in business from UCLA, John Csiszar worked in the financial services industry as a Registered Representative for 18 years. Along the way, Csiszar earned the Chartered Financial Planner and Registered Investment Advisor designations, in addition to being licensed as a life insurance agent, while simultaneously working for a major distribution house. of Wall Street and for his own investment consulting firm. During his tenure as an advisor, Csiszar managed over $100 million in client assets while providing individualized investment plans to hundreds of clients.

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