Serene Investing

Ben Stein’s latest column at Yahoo!Finance echoes the investing strategy I’ve settled upon – broad indexes and a few sensible ETFs. (Apparently, he also seems to like variable annuities, but then he’s might just be setting aside enough to be looking for more tax deferred investing – I don’t have that problem yet, and I still doubt they’d be the route I’d go if I did…) Give me a decently diversified, dollar-cost averaged portfolio of low-expense, no-fee mutual funds/ETFs, check the balances occassionally (or not; it’s not as if I plan on touching them for a long time – but it is kind of fun to watch ‘em float around, and having a grip on where you are as far as a goal is almost certainly a good thing), rebalance when necessary, and relax.

Years ago, I spent a not unconsiderable amount of time studying up on things like market timing, breakout investing (IBD puts out a daily paper seemingly focused around this single strategy), followed a few fund managers, read a few financial papers daily, etc. calculating all those ways of making that million in the next six months. Mind you, this was back when I was doing almost nothing financially outside of gathering up more debt. These days, I believe it all to be so much tripe. Unless you’ve got some insider knowledge (and thus, are, generally speaking, breaking the law), consistently and materially beating the market is no more than a pipe dream for the average investor. And if you’re reading this here at irregularpayments, sorry to say, but trust me, you’re the average investor…

In my opinion, of course…

[tags]investing, mutual funds, ETF, indexing, dollar cost averaging[/tags]