Tackle Today: 3 Steps to a Diversified Portfolio
January 20, 2023
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Building a diversified portfolio doesn’t need to be complicated. You can do it in three steps.
First: Decide what asset classes you want exposure to. Your choices include stocks, bonds, real estate, gold, oil, and bitcoin. In considering the options, look at their historical return profile and volatility. Your risk tolerance and investment objectives matter too.
Second: Decide what percentage of your account you want to allocate to each. Remember, the higher the percentage, the more impact the asset will carry in your portfolio. For most traditional investors, stocks get the lion’s share of the exposure because of their reliable long-term returns. Bonds and gold are mostly volatility reducers. Real estate returns have been respectable. Bitcoin is a lottery ticket with epic booms and busts. And oil further diversifies your basket.
Third: Decide which ticker symbol to use for each asset class. For stocks, you might use SPY or VTI. Bonds could be AGG. Real estate includes VNQ, USRT, and XLRE. Gold could be GLD or IAU. You can buy bitcoin directly or use BITO to trade options around it. Oil might include XLE, XOP, or USO.
Chart of the Day: Cameco (CCJ)
Cameco (CCJ) snapped back aggressively after Wednesday’s whack. It’s attempting a breakout this morning.
Options Theory Blog
How In-The-Money Covered Calls Work
Check out the most recent Options Theory blog where Coach Tyler Craig expands your knowledge of the options universe!
Today’s line up
Traders Lounge 11 AM EST
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Cash Flow Club Replay
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Halftime Report 12:30 PM EST
The Halftime Report starts at 12:30 EST and covers what news is driving the market, chart analysis from the movers and shakers of the day, and fun in a way that only the Coaches at Tackle Trading can deliver.
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