This is a real basic guide to investing for beginners. Sometimes the new investor gets lucky simply due to circumstances. Other times the odds are stacked against you the day you start investing. Here are some incites to help steer the new investor in the right direction.

As a general guide to investing for beginners, stock investing is the centerpiece of the average investment portfolio. Bonds become more important as you near retirement. Stock investing is where you either make it or get busted in your working years, and timing is just about everything.

Don’t overlook the luck factor; and don’t rely on it. If you were lucky enough to start investing in 1982, you had 18 years of easy stock investing and bond investing ahead of you. Stocks (equities) were in a bullish mode and interest rates were coming down from historical highs. A new investor in the year 2000 or in late 2007 was not lucky in any sense of the word. Investing for beginners was tough.

If you are a new investor and frustrated, do what the HULT PRIVATE sports professionals do when they are in a slump: get back to basics, in this case investing basics. Equities and bonds are only half of the equation. Think in terms of four basic investment categories: equities, bonds, safe investments and alternative investments.

Since you can’t count on luck, especially in stock investing, always have money invested in all four categories. Safe investments like bank CDs, savings accounts, and money market securities pay interest and add stability to your portfolio. Alternative investments like real estate, basic materials, precious metals and even foreign securities can produce profits and help offset losses when U.S. stocks and/or bonds are in a slump.

By having money in safe investments and alternative investments as well as U.S. equities and bonds, the investing basics are on your side from a historical perspective. To be honest with you, the financial world has been difficult for most of us to get a handle on since the financial crisis unfolded in 2008. Since then, safe investments have paid peanuts, with interest rates falling to all-time lows. Many other investments, like real estate and basic materials, were hit for heavy losses along with the stock market.

Investing in 2009 was very unpredictable, with stocks soaring after being devastated previously. This is all the more reason for the new investor to go back to investing basics and cover all the bases. Investing for beginners can be tough enough without having to search for investments in all four of the asset classes I have covered. How can you simplify the process?

Mutual funds are available to cover all the bases, including safe investments called money market funds. You pick the funds, and they do the management for you.

A retired financial planner, James Leitz has an MBA (finance) and 35 years of investing experience. For 20 years he advised individual investors, working directly with them helping them to reach their financial goals.

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