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Absolutely if you can only afford $50/$100 a month the an index tracking the FTSE or the DOW makes sense. Once your portfolio gets bigger start having a minim

Absolutely if you can only afford $50/$100 a month the an index tracking the FTSE or the DOW makes sense. Once your portfolio gets bigger start having a minimum investment amount of $1000 you need to start thinking about diversification.

tc313 9y ago
> start thinking about diversification Buying an index fund composed of 500 large U.S.-listed companies is pretty diversified. I suppose you could diversify internationally, but no need to stray from index funds if you're not managing your money full-time.
- achamayou 9y ago
  Stocks aren't the only asset available for investment, regardless of geographical location. They're also fairly volatile, so retail investment often consists of blending that with more stable fixed income assets.
- walshemj 9y ago
  I meant in different countries and sectors I did very well with a commercial property trust a few years back when the sector was out of favour.
  - dlubarov 9y ago
    You can use an international stock index fund like VT. That will include some real estate companies like EQR, but if you want extra real estate exposure, there are index funds like VNQ for that. Or if you want bonds, there are index funds like BND.
    - walshemj 9y ago
      Closed end funds (investment trusts etc) are much better for property for technical reasons a fund or OIEC has to retain cash.
discoursism 9y ago
A fund tracking the DOW is not such a great idea, considering it's not a representative slice of the market, and the process of deciding what's included is opaque and not exclusively dependent on externally verifiable factors. Tracking the S&P 500 or FTSE 100 is better, because the criteria for what they include can be validated externally. I mean it's better than picking stocks yourself, but what isn't? As long as it's equally easy to choose a good option and a less good option, why not choose the one that's better?
- walshemj 9y ago
  Sorry I should have said the S&P 500
rebuilder 9y ago
So you invest in other index funds and bonds. What the balance looks like requires taking some kind of position, I suppose, although a fairly common piece of advice seems to be to have investments in different geographical areas in proportion to their share of the global market. Bonds vs. equities is a matter of investment timescale and risk tolerance. That's the best I've managed to suss it out anyway, If you meant something different I'd be interested to hear it!

tc313 9y ago

> start thinking about diversification Buying an index fund composed of 500 large U.S.-listed companies is pretty diversified. I suppose you could diversify internationally, but no need to stray from index funds if you're not managing your money full-time.

achamayou 9y ago
Stocks aren't the only asset available for investment, regardless of geographical location. They're also fairly volatile, so retail investment often consists of blending that with more stable fixed income assets.
walshemj 9y ago
I meant in different countries and sectors I did very well with a commercial property trust a few years back when the sector was out of favour.
- dlubarov 9y ago
  You can use an international stock index fund like VT. That will include some real estate companies like EQR, but if you want extra real estate exposure, there are index funds like VNQ for that. Or if you want bonds, there are index funds like BND.
  - walshemj 9y ago
    Closed end funds (investment trusts etc) are much better for property for technical reasons a fund or OIEC has to retain cash.

discoursism 9y ago

A fund tracking the DOW is not such a great idea, considering it's not a representative slice of the market, and the process of deciding what's included is opaque and not exclusively dependent on externally verifiable factors. Tracking the S&P 500 or FTSE 100 is better, because the criteria for what they include can be validated externally. I mean it's better than picking stocks yourself, but what isn't? As long as it's equally easy to choose a good option and a less good option, why not choose the one that's better?

walshemj 9y ago
Sorry I should have said the S&P 500

rebuilder 9y ago

So you invest in other index funds and bonds. What the balance looks like requires taking some kind of position, I suppose, although a fairly common piece of advice seems to be to have investments in different geographical areas in proportion to their share of the global market. Bonds vs. equities is a matter of investment timescale and risk tolerance. That's the best I've managed to suss it out anyway, If you meant something different I'd be interested to hear it!