Financial Advice for my Son (and JPL/CIT Employees)



OK, if you have done all of the above, you are ready for INVESTING. What follows is a first course in investing, which amazingly, is almost all that anyone needs to know.

The reason you almost never hear about the following facts is that they are somewhat dull, they don't change much from year to year, and no one will get rich telling you these facts. In our age of advertising, that means no one is going to tell you about these. No salesmen will call, and no TV program or magazine can get more viewers or buyers with them. (Would you buy a magazine that month after month tells you the same thing?)

This first course in investing is made out of the following subjects:

  • The Efficiency of the Market
  • Risk
    Definition of Risk
    Return and Risk
  • Investing Time Horizon
  • Tax-Deferred Investments
  • Historical Return and Risk of Various Investments
  • Other tidbits
    Traders are Losers
    Dollar-Cost Averaging
    Never Commit Your Money to a Risky Investment at Once
    Personal Acceptance of Risk
  • Mutual Funds and Individual Stocks

    Mutual Fund Selection
    Penny Stocks


    Junk bonds
  • Speculative Bubbles

    Example of a simple asset allocation

    Slightly more complicated asset allocation

    Real Estate and Collectibles


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    e-mail: Tom Chester