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February 6, 2013
Choosing the Right Financial Adviser

CHICAGO — Searching for right adviser can be almost as difficult as searching for right stocks

CHICAGO — The gut-wrenching volatility in the stock market over the past few years has been a tough challenge for busy business owners and professionals. That’s probably why so many are looking for professional help in dealing with investment decisions.

Business for “financial advisers” has been booming since the 2008 market meltdown. The problem is that searching for the right adviser can be almost as difficult as searching for the right stocks.

In most states, anyone can declare himself or herself a financial adviser without the need for a license or any formal credentials, even to the point of creating an official sounding title. At most brokerage firms, employees who used to be called stockbrokers are now called financial consultants or advisers. Whatever they are called, it’s important to remember that they are essentially salesmen who earn their money by getting you to buy and sell equities.

April 3, 2012
Effective Diversification

CHICAGO — If there is one investment philosophy that approaches universal agreement among financial advisers, it’s the need for careful diversification in every portfolio in order to minimize risk

CHICAGO — If there is one investment philosophy that approaches universal agreement among financial advisers, it’s the need for careful diversification in every portfolio in order to minimize risk, but exactly what does diversification mean, and how can you tell if your investments are truly diversified?

One popular TV show on finances features a segment called “Am I Diversified?” in which viewers call in, give the host their top five holdings and the host lets them know if they are properly diversified. According to Jason Whitby, MBA, CFA®, CFP®, AIFA®, senior financial adviser with Miami-based Investor Solutions, it’s not that simple. “The idea of five-stock diversification is mostly refuted by the financial community,” he says, “which tends to agree that the number of individual stocks needed for diversification is actually closer to 30.”

August 16, 2011
Your Money: Leaning Toward Alternative Investments

CHICAGO — Judging from my e-mail, it’s not difficult to find savers and investors who are questioning the conventional wisdom when it comes to investing their money. With the stock market on an erratic, volatile course that seemingly leads nowhere, and yields on cash investments such as money markets and CDs almost nonexistent, more and more income-seeking investors are breaking the old rules by dipping a toe in waters they would have considered too risky a few years ago.

Instead of sticking to the philosophy that calls for portfolios laced solely with a careful mix of quality stocks, well-rated bonds and cash, these hardy souls are venturing into eyebrow-raising investments such as junk bonds, commercial real estate, options like puts and calls, and equities in emerging markets in an effort to improve the anemic and unpredictable returns they’ve been enduring of late. According to one adviser, taking on even a little more risk requires overcoming fear of foreign markets.