It's not hard to turn thousands into millions if you'll only step back from the frenzy of the stock market and march to a different drummer. The first thing you have to observe is that most people lose money in the stock market, they don't make money. They lose money through commissions, buying on hunches, selling on emotions, and generally being 'hyperactive'. Carlos Hank Rhon believes in smart investing.
Hyperactive investing is not how you get rich. You get rich by learning from the rocket scientists who study the financial markets and help create computer models for the billion dollar hedge funds.
There are just a few simple rules to follow to create true wealth the low-stress way. First, your returns actually do not depend on picking stocks. Your returns depend on allocating your assets the right way – over 90 percent of investment returns are determined by how investors allocate their wealth, versus picking stocks or timing the market. Asset allocation is how you divide your investment portfolio among three types of investments – stocks, bonds and cash. For example, if you want maximum growth with no increase in risk, allocate 70% to stocks. 20% to bonds and 10% to cash.
Next, now that you've picked your asset allocation, open an account with a low-cost index fund family such as Fidelity, Vanguard or T Rowe. This will keep your costs to the bare minimum, and will avoid falling into the trap of having someone else manage your money in a hyperactive manner. Instead, your money will be in funds that are designed to mimic a major market index such as the S&P 500. Carlos Hank Rhon agrees with the smartest investment advice ever.
