The Uses of a Passive Investment Strategy

 

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The Uses of a Passive Investment Strategy

Author: Phoenix Delray

Investing is one of the things that used to take an awful lot of training and experience to get right, but with the birth of the information age, it seems that more people than ever before are able to use their extra money and create something spectacular from it. One of the easiest ways of getting your investing portfolio off the ground is to use a passive investment strategy. In the simplest possible terms a passive investment strategy is one that does not use any type of forecasting and rather sticks to a pre-determined investment route.

With this in mind, a passive investment strategy will not use any type of market timing or stock picking, and rather relies on a solid history of specific investment to make a decision well ahead of time. In most cases, the companies and brokers that use this sort of strategy will pick indexes that are basically made up of several well performing stocks. Although the profit level of these investments is not as high as some other strategies, it has proven itself to be reliable time and time again. This is probably why so many newcomers to the investment game decide to go the passive route.

The facts that you need to pay attention to here are the averages of cost versus returns on investments. A passive investment strategy is basically an attempt to lower the cost of the initial investment rather than fighting to try and beat the averages on returns. For anyone who makes a living from investment, this also removes a lot of the stress associated with the task at hand. While there are no guarantees when it comes to making investments, there are certain methods that are known to be consistently profitable, and passive investment is one of them.

If you are looking at using a financial institution for your investments rather than going it alone, you should be on the lookout for one that uses passive investment as their staple strategy. This means that you are firstly more likely to see returns, and secondly, that you can start off your portfolio with a lot less money. Most companies that use these strategies will have a group of individual investors working in a pool. With a passive investment strategy, they are more likely to turn a profit for everyone involved, including themselves making this strategy a sound business decision in anyone’s book.

Article Source: http://www.articlesbase.com/investing-articles/the-uses-of-a-passive-investment-strategy-5957955.html

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20 Responses to The Uses of a Passive Investment Strategy

  1. ashishs says:

    Is earning 9% annual interest rate in bank FD better than to buying a property?

  2. ashishs says:

    Is earning 9% annual interest rate in bank FD better than to buying a property?

  3. Angry American says:

    I am 13 and have decided I want to invest my money.
    I only have $50 so not that much but what can i invest in?

  4. Angry American says:

    I am from Canada, there are not Tesco stores here. The closest thing is Fresh and Easy in the U.S. which I have been couple times. Do you think their market share domination in the UK is stable? What about in other countries like Thailand, Korea and Czech Republic?

  5. Nilu6686 says:

    Hi, Is it a good time to invest in gold? current price is 31924 rupees. how much rise one can expect end of the year in gold price?

  6. Angry American says:

    was it worth it?

  7. Who'sYoDaddy says:

    the “investment” cost us the end of the finest medical system in the world, the lost of allies in the mid-east, the worst unemployment since the great depression, the return to race problems and a national monetary crisis.

  8. gowthamg says:

    but there is no returns Nav is 10.80, so i change to any other fund kindly advice

  9. bajranglals says:

    I thinh you have opted growth fund,due volatility in share market the profit is not visible in value.you cal1.surrender policy,and invest in assured return policy like bima bachat,jeewan tarang.
    2.switch your growth fund to balance or income fund to reduce your share exposure risk.

  10. Alex says:

    I live in california and I want to invest in AloStar but there are no AloStar banks in California. Am I still able to invest in AloStar. even though it is out of state?

    simple question: Will i be able to invest in out of state banks?

    [i want to invest in CD’s]

  11. MogollonDude says:

    Forget banks and CD’s all are paper . Buy Gold and Silver coins to hold in hand .

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