In theory, sticking to an investment strategy for a million dollars is easy as pie. Just put your money into the stock market, let it sit for twenty years, and you’re likely to watch your wealth grow over time. That’s the beauty of long-term investing.
In practice, this is much, much, much more difficult. The day-to-day fluctuations of the stock market, along with longer economic downturns, can make this investing strategy difficult to stomach. Even though the stock market always eventually recovers and reaches a new high, it can be difficult for even risk-happy investors to stick with an all-stock portfolio.
It’s like dieting, in theory you can eat only vegetables and exercise all day to get in the best shape ever, but would you actually stick to this routine?
The best investing strategy is one you stick to, not the one that sounds good on paper. A wise investor will realize this and develop a realistic portfolio based on their risk tolerance. That’s why at LexION Capital, we sit down with each client individually to discuss their goals and needs, and develop a plan to reach them based on their appetite for risk.
