Top Investing Strategies for Long-Term Wealth;

Investing Trends for You & Your Readers

Barbara Friedberg, MBA, MShttp://barbarafriedbergpersonalfinance.comHow to Get Rich; Wealth Building Guide for the

Financially Illiterate (available at Amazon)

What Bob Friedberg, PhD teaches in his child therapy course!

What Does CBT Have to do with Investing?

I’m Going to Piss You Off

Research Rules- look at the data

Today’s topics: Efficient Market Hypothesis (EMH) & Modern Portfolio theory- only research supported strategies!

Who the H-ll am I and why should you listen to me? How I started investing-Homework

What are the most well researched investing methods?

How to separate the noise from the proven investing approaches.

How to integrate investing information into your site.

How to boost your own investing knowledge.

Where to look for inspiration and information.

Agenda

The research is clear! Over the long term, only approximately 30

% of professional investors beat the market! Of those 30%, few repeat year over year You can try to beat the markets, but it’s a

losers game! Index mutual fund or ETF in diversified asset

allocation-in line with your risk tolerance.

The Best Investing Approach

What is the efficient market hypothesis?

How do I implement?

Background-◦ Asset classes-Stocks, Bonds, Cash, Real Estate?

The Efficient Market Hypothesis Drives Investment Returns

The Dow Jones Industrial Average Index Investing: The Standard & Poor's 500 I

ndex Index Investing: The Nasdaq Composite Inde

x Index Investing: The Wilshire 5000 Total Mar

ket Index Index Investing: The Russell 2000 Index

The Most Popular Indexes

I get Asset Allocation but what percent should I put in each asset class?

•Risk averse: Zvi Bodie & Mike Piper•Sleep at Night Guide to Risk•Search “risk tolerance quiz”

Historical Data Regarding Market Timing-Do not jump in and out of the markets

Invest $1.00 in the S & P Index in 1926 In 2003, your dollar is worth $2,285That’s about 10 % per year return!

Now try some market timing: Invest $1.00 in the S & P Index in 1926 Trade out of the market during the 37 months

with the best returns – during 1926-2003. In 2003, your dollar is worth $17.42Miss the best 37 months during that 77 year

period and your return drops to 3.78 percent per year.

Source: Investment: Analysis & Management by Charles P. Jones

Albert Einstein called compound interest "the greatest mathematical discovery of all time"

Time & Compounding

Costs Matter! Low Cost Index Mutual Funds Great sample portfolios: http://www.marketwatch.com/lazyportfolio

How do I Invest? Individual stocks, Bonds, & Real Estate or Mutual Funds (ETFs)

http://www.marketwatch.com/lazyportfolio

Sample Lazy Portfolio10 Year return of 7.9% beats S & P 500 return

Of 7.65% with less risk (volatility)

S & P 500

Investing for Newbies Difference between a stock, bond, and

mutual fund What is asset allocation? How does risk tolerance relate to investing? What to do when the market tanks? Should I invest in individual stocks and

bonds or mutual fund?

Topics to write about on your site:

How and Where to Get Ideas to Write About on Your Site?

2 Ideas for Inspiration Use this model

1. News Jacking

2. Read to write

◦Get ideas and inspiration from reading

Read investment related publications such as; Money Magazine, WSJ, CNN Money, Kiplingers etc.

Use these 2 writing prompts:

1. List takeaway from article:2. What are the implications

for investors?

News Jacking; Use the news to write about investing

“Central Bank Stays Course on Easy-Money Policies”,Wall Street Journal, September 19, 2013

Takeaway from Article

“Fed officials voted to keep short-term interest rates near zero, where they have been pinned since late 2008…..expect to make the first rate increase in 2015 or later.”

Interest rates will likely be low for the next year or two.

Investing in low interest rate environment.

Tips for savers:◦Step up notes◦Mid term bonds & bond ladder

Tips for borrowers:◦Borrow now for appreciating assets

(home)

What are the implications for investors?Topics to Write About:

How to Separate the Noise

Noise Not Noise

Be critical

You’re not going to make money trading in and out of the markets

Avoid “hot tips”

Avoid “hot funds”

Long term economic information-can be helpful

Use research supported approaches

Narrow your information consumption window

“Investing should be more like watching paint dry or watching grass grow. If you want excitement, take $800 and go to Las Vegas.”Paul Samuelson

 "The individual investor should act consistently as an investor and not as a speculator." - Ben Graham

"If you have trouble imagining a 20% loss in the stock market, you shouldn't be in stocks."-- John, founder of Vanguard and the index fund

"Investors should always keep in mind that the most important metric is not the returns achieved but the returns weighed against the risks incurred. Ultimately, nothing should be more important to investors than the ability to sleep soundly at night."-- Seth Klarman

Investing Quotes from Top Investors & Economists

The best way to own common stocks is through index funds...- Warren Buffett, Berkshire Hathaway Inc. 1996 Shareholder Letter

"Most of my investments are in equity index funds." BusinessWeek & The Parable of Money Managers - William F. Sharpe, Nobel Laureate in Economics, 1990

"Most individual investors would be better off in an index mutual fund."Peter Lynch

So investors shouldn't delude themselves about beating the market? "They're just not going to do it. It's just not going to happen."Daniel Kahneman, Nobel Laureate in Economics, 2002;

Investing Quotes from Top Investors & Economists

Market Forecasts-Can Strong Fundamentals Predict Stock Market Returns?

http://barbarafriedbergpersonalfinance.com/market-forecasts-fundamentals-predict-stock-market-returns/

Latest Research on stock investing

Spend time educating yourself.

Designate only a portion of your investment portfolio (some recommend 10%) to speculating.

What if you want to pick stocks, trade options, and get into forex?

Email me with your questions. Use Contact form on the site

http://barbarafriedbergpersonalfinance.com

Wall Street Journal Money Magazine, Kiplinger’s, Smart Money The Elements of Investing, by Charles D. Ellis &

Burton G. Malkiel A Random Walk Down Wall Street, by Burton G.

Malkiel AAII-American Association of Individual Investors Free: 20 Minute Guide to Investing, by Barbara

Friedberg (http://forms.aweber.com/form/00/151654000.htm)

Free: Investopedia (http://www.investopedia.com/) Yahoo! Finance (http://finance.yahoo.com/), MSN

Money (http://money.msn.com/)

Resources-Read these books & periodicals to educate yourself