Getting the best investment returns involves making good decisions with any investment portfolio, understanding the market conditions, what you want from the market and how quick you want it to happen. In some cases, finding the right stocks, bonds and deposit accounts will be extremely difficult, especially when the market is struggling to maintain its numbers. However, even in hard times there are certain investment strategies that can pay off.
Generally speaking, one of the keys to the best investment returns is diversification. Putting too much of your capital into stocks could be very detrimental to any plan. However, putting more into stocks and insured investment accounts will often not provide the returns you are looking for. Therefore, there will need to be a good mix.
That mix will change the closer you get to retirement age, as any good financial advisor will tell you. As retirement age looms closer, more of your assets need to be in safer products. These could include certificates of deposit and perhaps even precious metals. While precious metals are not insured, they tend to stay relatively stable over time but also have the ability to increase in value when many other products are faltering. These may not offer the best investment returns, but will offer security when it is needed the most.
The best investment returns will likely be realized when the investor is first starting out with a 401(k) or other IRA account. At this point, investments will be more in stocks than anything else. Further, most companies will offer a package of higher risk stocks that also have the potential for higher returns. This is the time of a person's life when they are able to take the most risk. In those cases, investment returns at such a time have the potential of being substantially higher than at any other point. Whether they are, in reality, higher is determined by market conditions.
If there are times when the market shows a prolonged downturn, it may be advisable to put investments in a much more secured form until the market begins a recovery. Though there will be some opportunity lost during this point, it may help prevent a substantial devaluation of the portfolio. A financial planner will be able to advise in this matter.
Good retirement fund management is a key to a healthy and comfortable retirement. Finding the right mix of stocks and bonds is no easy task, even for professionals. However, finding a good advisor offers the best chance for success with those investment returns.
