The Three Ds of Investing

Courtesy of AGF Investments, Posted 21 May 2015


By using all three in your investment strategy, you can reduce risk and enhance your long-term performance potential.

DIVERSIFICATION

Diversifying your investments can be an effective way to help protect your portfolio. By investing in different asset classes, regions, market capitalizations and investment styles, you can better manage risk by smoothing out the ups and downs.

For example, growth and value are two investment styles that have traditionally had an inverse relationship. By investing in both styles, you should be able to enjoy a smoother ride, as one style will be up, while the other is down, mitigating your risk and increasing your return potential.

DOLLAR COST AVERAGING

Dollar cost averaging is simply the discipline of investing a fixed amount at regular intervals. It eliminates having to predict when an investment will be at its high or low, since those predictions are rarely accurate.

DISCIPLINE

When it comes to investing, patience is a virtue. By maintaining your focus and staying invested through all market activity, you can increase the long-term return potential of your portfolio.

That discipline ensures that you won't miss out on potential gains when markets are rising. It can also help you avoid the emotional pitfalls of buying overvalued investments or selling at the wrong time.

To put your plan in action please contact your financial advisor.