Do You Need an Investment Policy Statement?

There is a new crisis in Washington is the ‘fiscal cliff or is the concern Europe or the Middle East or???’. Many ‘experts’ predict financial chaos and extremely volatile markets for the foreseeable future. As a long term investor you should not be concerned with these short term fluctuations.

Federal Reserve Bank of NY, 33 Liberty Street
Federal Reserve Bank of NY, 33 Liberty Street (Photo credit: Wikipedia)

No One Can Predict the Future…

Predicting the future cannot be done consistently.  Anyone’s ability to predict what will happen next is short lived and a matter of luck and not skill AND not repeatable.

Just as you would never take a long distance car trip without a map, you should never buy any investment without an Investment policy statement. This is a written document that states the goal of your portfolio, how much risk you will take, and what you will and won’t do when markets become volatile and crash.

By preparing a written IPS, the prudent investor can:

  1. Avoid unnecessary differences of opinion and the resulting conflicts.
  2. Minimize the possibility of missteps due to lack of clear guidelines.
  3. Avoid making predictions of the future..
  4. Invest without anxiety.

Don’t Build a Portfolio Without an Investment Policy Statement.


The Wall Street bullies do not want you to have such a guide for your investments. They would prefer you invest your money, the money you are saving for retirement or any long term financial goal, based on emotions.


These bullies create and promote financial pornography to keep you gambling and speculating with your money.


These are all short term situations and will correct themselves in time.


Remember all successful business ventures have a plan and they stick with that plan. This plan is your investment policy statement. To succeed long term design a prudent portfolio and remain disciplined to your plan. The only adjustment should be to reduce risk as you approach retirement or other long term financial goal.


The Free Markets Work.

No government can distribute capital as efficiently as the free markets. We must continue to believe this to be true and have faith in people NOT governments.


To succeed in reaching your long term financial goals you must own equities….globally diversify…..rebalance.


Most importantly have FAITH and seek the help of an Investor Coach.

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