The Investor Quiz

Below are the Must Answer Questions that every investor should work to answer if they want to achieve investing confidence and peace of mind. The battle for sound investing is often created between your two ears. In other words, if you are not an educated investor then you are easily susceptible to fear, anxiety, stress and confusion regarding your important investment decisions.

See if you can answer “yes” to the following questions.
Remember, you must be 100% confident that you know the answer in order for it to qualify as a “yes” answer.

1. Are you invested in the market? (This should be an easy one!)

2. Do you know how markets work? (Do you understand the underlying dynamics of the market? If not, you are setting yourself up for stress and anxiety when the markets underperform.)

3. Have you defined your investment philosophy? (Do you believe that markets are efficient or do you believe that markets are inefficient? Does your investment strategy match your investment philosophy?)

4. Have you identified your personal risk tolerance? (At what negative return level do you become unable to “hang in there” when markets are down?)

5. Do you have a system to measure diversification in your portfolio? (Does owning lots of stocks or mutual funds equal diversification? Will all of your holdings move down together during the next market downturn?)

6. Do you have system to measure the volatility in your portfolio? (If you can’t measure the risk or volatility then how can you expect to control it?)

7. Do you consistently and predictably achieve market returns? (The vast majority of investors don’t.)

8. Have you measured the total amount of commissions and costs in your portfolio? (There are often fees and expenses that are not easily visible to the investor)

9. Do you have an Investment Policy Statement? (This is mandatory for qualified pension plans. If it is good for them it may also good for you.)

10. Do you know the three warning signs that you or your advisor are gambling and speculating with your money versus prudently investing it?

A properly educated investor should be able to answer “yes” to most all of these questions. If you are not able to answer “yes” then give us a call at 419-877-0730 to learn how we can help you become a more educated investor.