What can you expect from your investments? Ideally, of course, you want them to help you meet your goals, such as a comfortable retirement. But you should be aware that your expectations can be affected by several factors.
First of all, you should expect different results based on the type of investments. If your portfolio is predominately bonds and fixed-income vehicles, there may not be as much growth potential as if you owned mostly stocks. On the other hand, you should expect a stock-heavy portfolio to fluctuate in value more than one that’s fixed income-heavy.
First of all, you should expect different results based on the type of investments. If your portfolio is predominately bonds and fixed-income vehicles, there may not be as much growth potential as if you owned mostly stocks. On the other hand, you should expect a stock-heavy portfolio to fluctuate in value more than one that’s fixed income-heavy.
One other investment behavior that may explain your expectations is called anchoring – the insistence on sticking with an investment you once liked, even if it consistently underperforms.
Being familiar with the factors that may shape your expectations can help you be more realistic about your investments – and make it easier to understand what you need to do to reach your goals.
This article was written by Edward Jones for use by your local Edward Jones Financial Advisor. Edward Jones, Member SIPC