Risk Tolerance vs Risk Capacity
The unpredictable year of 2020 reminded us of the fact that risk is inevitable in the market. The chart below shows what diversification can do to protect your portfolio – but it does not eliminate risk entirely. Regardless of how well you diversify your portfolio, there will always be systematic risk present. […]
Savings Rate vs. Investment Return: Which is more important in wealth creation?
Most people have heard the advice to save early. We wrote a blog in 2014 titled Importance of Investing at a Young Age and Best Practices. In addition to emphasizing the importance of saving early, it also answers the common question of “where” to invest your savings. When it comes to investing though, most individual […]
Time Weighted vs. Money Weighted Returns
Many people assume calculating performance returns on investment accounts to be a very simple process. In its simplest form, you can get your percentage investment return by using this simple equation: (Ending Value – Beginning Value) / Beginning Value. With that in mind, it can get more complicated when you add in factors such as […]