The Educated Investor

More investment options can mean more peril

Investing is complicated for everyone, but as you amass more wealth and have more investment choices, it only gets more complex. As it turns out, having more choices isn’t always better; it often means more twists, tricks, and traps. Here are six potential pitfalls to carefully avoid:

Taxes are often considered a necessary evil. The topic evokes strong emotions. How we perceive taxes and how we feel about paying them are complex issues.

It can be hard to hear the best course of action during tough market times may be to do nothing. It can be even harder to repeatedly hear the message as things seem to get worse. But it is a message we would not repeat if we did not truly believe it was in your best interests. The following discusses why our message is not wavering despite market conditions.

When you interview potential financial advisors, you should look for the advisor who gives the best advice and is the best fit for you. The best advisors begin earning their fee from the day they are hired by helping you determine your most appropriate asset allocation, according to your unique ability, willingness and need to take risk (what we call "risk personality"). This is what we do with every single investor who becomes a client.

While corporate bonds have had slightly better returns than Treasuries, it is important to consider all the historical evidence before adding them to your portfolio.

How do you know when you have enough? It's a different answer for everyone, but not knowing can put your investments (and your peace of mind) in jeopardy.

Currently, rates in the fixed income market are very low. As of September 13, the yield on the five-year Treasury note was close to 1.5 percent. In a low-rate environment in particular, it is critical to understand the differences between and the concepts of coupon rate, yield and expected return on fixed income securities.

The media continues to be focused on budget and pension obligation problems within the municipal bond market. However, it is important to remember that default risk has been incredibly small in the municipal market. The following provides our take on the municipal bond market.

You’re ready to retire and have paid a lot into the Social Security system. Now that you’re finally eligible for benefits, your advisor and other experts might be saying, “Not yet!” Why should you have to wait any longer?

Investors are faced with a perfect storm of information overload, human emotions and market volatility. Following is a discussion of those threats to investors’ portfolios and a way to avoid the storm.