Guarding Your Retirement Portfolio against Market Swings

When you are trying to successfully build a retirement portfolio, you want to know that your money is relatively safe. This is the money that you are going to be living on at some point, once you retire. Here are a few things to consider about guarding your retirement portfolio against market swings.


Historically, the stock market has always increased in value over the long term. Because of this, if you are a long-term investor, investing in the stock market can provide you with some value. However, if you invest in the wrong types of stocks, your portfolio will be prone to damage during large market swings. When selecting stocks, you want to stay away from the volatile groups of stocks and stick with those that provide steady growth. For example, if you invest in companies that are known as growth stocks, your investment could be subject to a great deal of volatility. Instead, you should think about investing in reputable companies that have been around for an extended period of time. This will provide you with a slow and steady growth curve in your retirement portfolio.


If you are trying to get away from large market swings, you might also want to consider investing in bonds. You could invest in corporate or government bonds, depending on your preference. When you invest in a corporate bond, you are essentially lending money to a company. This company is going to pay you a certain amount of money in interest each month until the bond has matured. At that point, you will be able to get your initial investment back. This type of investment is going to provide you with a regular interest payment regardless of what is going on in the stock market. If you invest in government bonds, you will be able to take advantage of one of the safest investments available. Most government bonds are guaranteed to double in value over a certain period of time.

Equity Funds

Something else to consider investing in is an equity fund. This is a mutual fund that pools all of the investors' money together. They will then use this money to purchase many different stocks from the market. A fund manager is in charge of selecting the individual companies to invest in. With this method, you can properly diversify your retirement investing, and large market swings will not affect you as drastically.

Market Neutral Funds

You might also take a look at investing in market neutral funds if you want to get away from market swings. Market neutral funds are mutual funds that aim to provide returns that are independent from the stock market. These funds invest in a number of different things in order to accomplish this. They might invest in foreign currencies, commodities, real estate and many other things that can provide returns outside of the stock market.

blog comments powered by Disqus