Does it seem like the daily fluctuations in the stock market are way to extreme and make it seem as though you have to watch your portfolio daily? If you watch TV or read the papers, why do different asset managers have such different views about the future direction of the stock market? How can I tell if today's news is truly important or will go the way of the "fiscal cliff" which turned out to be a nonevent back in December 2012? Your financial firm is supposed to offer investment advice and guidance to remove that burden from you, right?
Financial Advisors and financial planners have been utilizing Modern Portfolio Theory (MPT) for the past 50 years to recommend stock and bond selections for you. Are these MPT ideas still relevant today? It might surprise you how little your financial professional even knows about MPT even. Why does it even matter?
Surprisingly, you will find that, contrary to what you might think, most financial advice is not long term in nature. Usually financial results are talked about on a quarterly basis. In my opinion, that is entirely too short of a period. For example, if you have 25 years to go until retirement, why would you be so myopic to focus on the next 90 days so intently?
In this book I explain how to think long term about your portfolio. If you change your thinking about your investments in terms of one-year and five-year increments, you will have much better success. The daily price fluctuations of stocks are way to volatile to focus on anything else.
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