Our series on the Principles of Successful Investing continues, building on prior posts on the difficulty of timing the market and how to think about investment risk. This week, we share a video about Building Confidence as an investor.
When deciding how to allocate your portfolio between stocks and bonds, focus on regret. You want the regret you have on days when the market goes down, and you're sorry you have so much stock, to be balanced by the regret you have when the market goes up and you're sorry you don't have more stock.
In the video below, Mr. French explains:
"The biggest way I manage my regret with all sorts of things is trying to judge myself on my ex-ante decisions, not on the ex-post outcomes."
There's no way to know exactly which allocation is optimal and it is most important to develop a mix of stocks and bonds that is optimal for you and one that you are comfortable sticking with in all market conditions, without regret.
We hope these videos continue to help you navigate the complex market of choices and decisions that investors are confronted with every day.
-EnRich Financial Partners LLC
Investment Advisory Services offered through EnRich Financial Partners LLC, a Registered Investment Advisor.
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