Coventry Financial Group’s 6 Simple Rules

There are 6 Simple Rules that are important to any long term investor’s success. Three are related to investor behavior (Principles) – and three are portfolio strategies (Practices). The great part of this recipe for success is that our clients play an equally important role in the success of their portfolio, while we are tasked with implementing and executing the strategy. Our goal in sharing these 6 Simple Rules is to arm our clients with information, so that we are working as a team to provide the best possible results in any market conditions.

The average “do-it- yourself” investor is overwhelmed with too many choices, too much information, a flood of negative and irrelevant current events, misinformation regarding risk and volatility, lack of transparency regarding fees, and an overall fear of investing* that leads to them standing like a deer in the headlights, doing NOTHING. But most of all what the do-it- yourself investors are missing is a lack of a STRATEGY and a PLAN.

Following these 6 Simple Rules are critical to any portfolio’s success. Lose any one, and you’re done – the odds of successful investing are reduced to pure speculation and price momentum.

3 Principles (Client) - Investor Behavior

1. Faith in The Future
No one ever got rich on a doomsday theory.

2. Patience
Wait out declines. The average intra-year decline since 1980 has been 14%. During that same time- frame the S&P has gone from 106 to over 2800. (Returning an average of 11.62% per year)

3. Discipline
Keep doing the right thing.

3 Practices (Investment Advisor) - Portfolio Strategies

4. Asset Allocation*
A proper mix of both stocks and bonds. (Modern Portfolio Theory) 

5. Diversification*
You will never own enough of any ONE THING:
     a) To be killed by it.
     b) To make a killing in it.

6. Rebalancing*
Annually or as needed in order to maintain your original asset allocation (or risk tolerance)

* These services are offered by Brian Coventry through his affiliation with Avantax.