Either it does not take much cash to survive long in Pakistan, or Osama Bin Laden has the world’s worst financial planner. When he was found Sunday night, still warm with two SEAL bullets in him, he had an escape plan that seemed like it was concocted by a toddler. Bin Laden had, sewed into his outfit, 500 euros and two phone numbers. Other than that, he was apparently relying on some sort of underground railroad for maniacs.
It is unlikely that you, as an investor, will ever need to prepare for the day when Marines or Navy SEALS bust down your door and start shooting. It would, however, be prudent to have your own investment plan for the future, so you can read Benzinga and react to whatever the markets are doing.
A few things to think about, whether you’re a beginning investor or a seasoned pro, include your asset allocations, diversification, and your buying/selling strategy. Your age, your goals for investing, and your financial and time resources will all factor in to how you want to play the market.
Asset allocation is essentially going to be a product of your time frame (a young investor might have more leeway to go after higher-risk, higher-yield assets), your financial responsibilities, and your ability to absorb risk. Depending on those variables, you’ll want some mix of stocks, bonds and ETFs, among other things. You’ll want to consider staying domestic or going international. Do you take a gamble that China will keep growing? Do you jump into emerging markets?
Diversification is a simple concept of not putting all your money into one fund, one stock, or one market. Spread your investment dollars around, and you’ll spread your risk of losing all your money — either because of natural disaster, market crashes, or some other financial calamity, such as a Madoff-style scam.
The other thing to consider is how and when you will buy and sell your assets. Some investors, particularly those with a lot of time (and/or a Benzinga Pro account) will routinely buy stocks when they dip a little and then sell them at higher points, only to repurchase the stock when it later drops. This timing-the-market strategy is riskier, but offers additional profit margins for clued-in investors. The other strategy is buy-and-hold, where you periodically buy your investments regardless of price. If the price is low, you end up with more shares; if it rises, you have less shares at a higher value. Over time, the two extremes should even out.
There’s a lot of compliance they have to go through, a lot of costs and unless they’ve got a strong business then they’d find it difficult to make good money
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