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With stocks, diversification is key to success.
If youre young and can handle more risk, a growth stock may fit your portfolio.
If youre older and need income, dividend stocks might be a better choice.
Heres a fleshed-out example.
ensure your stock choices align with your financial goals.
Also, know that high-dividend-paying stocks may not appreciate as much as growth stocks.
you better be just as rigorously inquisitive and informed about the company youre thinking about investing in.
Not only could you be too biased, but you also could overspend.
see to it youre not overpaying, said Alejandro Zambrano, chief market analyst atThinkMarkets.
A media buyer I know once recommended Meta stock because he knew firsthand how valuable their ad platform was.
He bought the stock when it was cheap.
Therefore, its crucial to do research even if youre familiar with the company.
So, the lesson?
Its a matter of being your own devils advocate.
The stock market is no exception, Martin said.
Start by writing out all the reasons that buying a particular stock may be a bad idea.
When it comes to money, its always good to have a degree of pessimism.
If you believe in tech, thats fine, but portfolio diversification is a proven method to reduce risk.
In the U.S., there are thousands of ETFs available, Martin said.
Last month, my father was debating whichvolatile chipmaker stockto buy.
I suggested he buy them all through an ETF.
Note that there is a financial caveat with ETFs.
But it could be worth it.
On the downside, ETFs have fees (unlike individual stocks), Martin said.
Vanguard, known for its low fees, is a great option.
Over time, portfolios often benefit from sector or index ETFs, assuming the fees are nominal.
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