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Investments: Embracing average returns

By Sharla J. Jessop

For Smedley Financial BrandView

Published: Thursday, May 29 2014 10:10 a.m. MDT

Its not exciting or flashy, but consistent returns are important in reaching financial goals. This can be accomplished through diversification. As an example, a portfolio with 60 percent allocated to the S&P 500 and 40 percent allocated to fixed-income has a greater chance of smoothing out big market swings. Generally you will not have the hottest returns nor will you suffer the greatest losses. When compared to the same 2008 bear market, the hypothetical 60/40 portfolio would have lost only 35 percent compared to the S&P 500s 56.78 percent loss. The break-even point comes at just shy of two years as compared to over four. This type of diversified portfolio does not prevent losses but it does help reduce market risk. The result is average returns.

When it comes to investing, the most important factor should be reaching your financial goals with a reasonable amount of risk based on your objectives and risk-tolerance. We believe that if investors avoid the emotions that push them to chase high returns and remember that consistency pays in the long run, they will be better positioned to meet their investment expectations and concurrently their goals.

If it has been awhile since you have reviewed your investment strategy and financial goals, we encourage you to meet with one of our wealth management consultants for a second opinion. Call to schedule an appointment at (800) 748-4788 or visit us online at www.smedleyfinancial.com.

Smedley Financial Services, Inc. is an SEC Registered Investment Advisory Firm. Sharla J. Jessop is an Advisor Representative of Smedley Financial Services, Inc. and Registered Representative of Securities America, Inc. Securities offered through Securities America, Inc. Member FINRA/SIPC. Smedley Financial Services, Inc. and Securities America, Inc. are separate entities. Copyright 2014 Smedley Financial Services, Inc. All rights reserved.

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