The Stock Market
Corporate incomes, including advertising monies spent by Wall Street's huge brokerage firms, are gleaned in fees and charges from portfolios constructed by selling stocks, bonds and, largely, mutual funds to their customers.
An important fact can be found in a Kiplinger Magazine April 15, 2015 article written by Stephen Goldberg:
Thanks primarily to their rock-bottom costs, index funds have outperformed roughly two thirds of actively managed funds across all kinds of markets and they'll almost surely continue to do so. What's more, picking the one-third of funds that will beat their indexes is extremely difficult; many argue that it is impossible.
If one remained fully invested, it took around five and a half years just to return to a break-even value following the 2008 "market adjustment". Financial experts refer to this as volatility risk.
When markets decline it is evidenced in corresponding index funds as in 2008. For persons in and near retirement the paper losses were very depressing. For retirees taking income from their portfolios the losses realized were devastating.
According to the 2016 Dalbar Report, the average investor in asset allocation mutual funds (those that "diversify" your money among a variety of asset classes) earned only 1.65% per year over the previous three decades! The report disclosed that the average investor in equity mutual funds averaged only 3.66% per year, beating inflation by only 1% per year after stressful volatility roller-coaster rides and sleepless nights.
The report concluded: The results consistently show that the average investor earns less in many cases, much less than mutual fund performance reports would suggest.
I consider it to be an important responsibility to provide information on ways to reduce portfolio risk. Safety, the protection of family assets, is primary today for the overwhelming majority of employed and retired Americans.
This website is provided for informational purposes only and is not intended to provide any tax, legal, financial planning, insurance, accounting, investment, or any other kind of professional advice or services. Nothing on this website should be construed as an offer to sell or a recommendation for any security, insurance policy, or investment strategy. For your information this Website may provide links to other websites that are not operated by Stewart Ogilby. Those links do not mean that Stewart Ogilby necessarily endorses, approves, or sponsors any products or information available at the linked site. Before purchasing any financial product be sure to do your own due diligence and you should consult with an appropriate tax or legal professional before taking action based on any suggestions or information on this site. You alone are solely responsible for determining whether any financial or insurance strategy, product or service, is appropriate or suitable for you based on your investment objectives and personal and financial situation. By contacting Stewart Ogilby you may be offered insurance products by an agent licensed in your state. Annuity product guarantees rely on the financial strength and claims-paying ability of the issuing insurer. Annuity riders may be available for an additional annual premium that can provide additional benefits and income guarantees.