For longer term investors, your age can be your "safety net"
Your age is a starting point for how much of your portfolio should be invested in bonds and cash. This means, as a starting point or rule of thumb:
A) 30 years of age = 70% growth / 30% income
B) 50 years of age = 50% growth / 50% income
C) 70 years of age = 30% growth / 70% income
Of course this is only a rule-of-thumb and individual investors should consult their advisors about the ideal allocation for themselves. If one is somewhat risk averse, but still concerned about protecting assets from longer term inflation, a less volatile portfolio would be comprised of:
A) 30 years of age = 60% growth / 40% income
B) 50 years of age = 40% growth / 60% income
C) 70 years of age = 20% growth / 80% income
Further risk-rduction can be achieved by investing in funds rather than individual securities, particiualrly valid advice for smaller and medium size portfolios.
For those around 50 who have shied away from stocks and stock funds the past few years, the shakeout you feared has occurred and it may be worthwhile to dollar-cost-avrage into a rebablancing program that gradually brings your equity up to the desired level.
Recent weeks have been troublesome for professional and individual investors alike, but other basic rules of thumb and aphorisms must also be kept in mind:
Invest at the sound of cannons, divest at the sound of violins.
Buy when there's blood in the streets ...
When everyone is greedy, be a little fearful. When everyone is fearful, be a little greedy.
And on a more sobering note:
Never try to catch a falling knife ...
The trend is your friend ...
One thing to keep in mind is that you can almost eliminate individual company risk while enjoying strong sector returns by investing green stock mutual funds, clean energy investment funds, wind power ETFs, solar energy mutual funds and other diversified renewable power growth vehicles.
A stock that is way down can indicate a troubled company on the way to zero, while a mutual fund representing a hard-hit sector often offersextraordinary capital gains opportunities with much lower risk than investing in individual securities. Here is a link to some well-managed green energy stock funds, as gradually building positions in clean energy funds is a prudent strategy for longterm growth investors.
For this article on WaterIntelll.com, we are focusing on energy from water (tidal, wave, hydro), water purification / wastewater treatment, water desalination / water recycling and water conservation technology companies.
Some water stocks to research:
World's top water filtration company closed at 32.07 with a market capitalization of 3.8 billion, The PE is 18.2, the yield is 1.6% and PLL continues to exhibit strong revenue growth. The year's high was 43.19.
BMII manufactures flow measurement and control products for water utilities, municipal utilities and industrial customers globally. At 37.66, the shares are down from 62. 74 and now offer a PE of 23.9 and a yield of 1.17%. Again, here's a water-related stock that lomngterm investors will want to look into.
WTS is a specialist in water quality, water safety, water flow control and water conservation with steadily growing revnues. At 27.86, the stock trades at 14.34 times earnings and yields 1.58%. Watts Water Tech is a solid USA growth company with rising worldwide sales, and with the stock not far off its 52 week high of 33.00, and from a medium term trading point of view, it has the potential to be among the first American stocks to regularly appear on New High stock lists, possibly giving it another $7 or 8 of momentum beyond the previous high. Definitely worth researching to assess how solid the revenue growth is ...
KHD is actually far more involved in the wind energy industry these days than they are in hydropower, but their roots are in small-scale hydropower and they are good at it. Developer, owner and operator of 20 EcoLogo certified generating facilities totaling 364 megawatt net to its interest located in British Columbia, Alberta, Ontario, and Québec with 12 run of river hydroelectric plants; seven wind plants and one biomass plant. One wind project in development is an additional 132 megawatts and there are other projects in the pipeline. At 3,38, down from 8.01, the stock remains speculative but offers a diversified longterm green energy investment and a an experienced team.
OPTT is a wave energy technology leader that has developed the PowerBuoy wave power system. Though revenues are minimal they are starting to grow, and with the PowerBuoy already in operation off Spain, Ocean Power is worth researching.
This high potential clean energy stock closed today at 7.00, down from 19.75, with just over ten million shares outstanding.
More green power and water technology stocks links: