For the investor, some bold words
I regard my home as a place to live, not as an investment. It is not a substitute for retirement savings.</br></br>I invest regular amounts every month, in both rising and falling markets. I know I cannot gauge market tops and bottoms. If I receive a windfall -- a bonus, bequest or gift -- I gradually feed it into my regular investment mix.</br></br>My share of bonds roughly equals my age. I will allocate to stocks a declining portion of my financial assets as I get older.</br></br>I rebalance my portfolio every quarter. If the stock market plunges, pushing my stock allocation way below its target percentage, I sell bonds and use my cash to buy stocks.</br></br>I force myself to sell high and buy low by periodic rebalancing -- just what is temperamentally difficult for most investors to do.