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Managing Your Investments With A Good Advisor Can Make Sense

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Managing your investments with a good advisor makes sense for a lot of investors, especially those who may not have the time to properly research and manage their own investment accounts.Two heads are better than one, and that is especially true when investing.A good advisor can do several things for an investor who is looking to get the most out of his or her money.

Firstly, a good advisor can help an investor create an investment plan.An investment plan will take into account the things that the investor wants to accomplish through his or her investments and the investor's tolerance for risk.The plan will help the investor know what he or she wants to do and how to get it done through investing correctly.

Once a plan has been created, an investment advisor can help make sure that the plan is implemented consistently.This means that the investor can avoid being distracted by the next latest and greatest investment and will be more easily able to attain his or her goals.Investment distractions can come from everywhere - the well-meaning stock advice of a coworker, a crazy uncle's next greatest idea, an article in the Wall Street Journal or the commentary by someone on television or on the internet.

A good advisor will help remove the emotion from investing.By having someone to discuss ideas with, the investor doesn't have to worry about jumping off the deep end because of something that has happened to trigger his or her emotions.Maybe the investor saw a commercial for a company that had his or her favorite star, or the investor read an article that portrayed the investment in a bad light, that may trigger the emotional response to purchase stock in one company and dump stock in another company.The advisor can discuss these responses and their potential impact on the person's portfolio.

No investor can know everything, especially when the investor is required to work a fulltime job that does not involve investing.A good advisor, however, has a lot more time to do the research on companies, sectors and alternative investments.This research combined with an intimate knowledge of the investor, his or her characteristics and current financial portfolio can help the advisor hone in on those things that he or she needs to know in order to be of the most use to an investor.

In fact, it is the advisor's knowledge of the investor that can make the difference between a good experience and a bad experience.Individual investors have different needs and different goals when it comes to investing; they also have different ideas of how much risk is worth a good return.Some investors look at the money they use for investing as really a kind of fun fund.Hitting a home run for these investors is really what investing is all about, kind of like more intelligent gambling.Other investors believe in slow and steady winning the race, and so like the tortoise, they are content with building wealth in small increments."No risk, no reward" doesn't really go over well with the tortoise.
This type of knowledge allows the advisor to make recommendations about which stocks or mutual funds are appropriate for the individual and what the strengths and weaknesses of the particular investments are.

Managing your investments with a good advisor allows you to overcome many of the limitations that come with being an individual investor.You may even be able to gain access to certain mutual funds that may not otherwise be available and all for an investment of between two percent and .5 percent of the value of the investments.


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