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The Financial Survival Guide to Retirement

The Financial Survival Guide to Retirement. Investment In Practice. Review. Efficient Market Hypothesis Modern Portfolio Theory Post-Modern Portfolio Theory What do you think?. Review. Determine your investment objective Know your risk tolerance Identify your alpha and beta

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The Financial Survival Guide to Retirement

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  1. The Financial Survival Guide to Retirement Investment In Practice

  2. Review • Efficient Market Hypothesis • Modern Portfolio Theory • Post-Modern Portfolio Theory • What do you think?

  3. Review • Determine your investment objective • Know your risk tolerance • Identify your alpha and beta • Alpha – percent you are willing to bet • Beta – percent invested in the market • Place your bets with your Alpha • Invest Beta according to asset allocation • Use index funds to match the market

  4. Review • Asset allocation is the single biggest determinate of portfolio results • What’s your beta? • Major asset classes • Stocks • Bonds, • Cash • How you allocate your investments depends upon the returns you need and risk you can take • Rule-of-thumb: %stock = 100 - age

  5. Investment Examples • Example advice from Money Magazine and Smart Money • Review their situation • What would you advise? • What do you think of the advice given?

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