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Robert A. Imparato, Jr CFP®
CERTIFIED FINANCIAL PLANNER™ professional
Craig A. Hyldahl CFP®
CERTIFIED FINANCIAL PLANNER™ professional
R.I.C.H. Planning Group, LLC
105 Fieldcrest Avenue, Suite #507
Edison, NJ 08837
Robert: 732-326-5240
Craig: 732-326-5240
Fax: 732-326-5331
Robert: robert@richplanninggroup.com
Craig: craig@richplanninggroup.com
Website: www.richplanninggroup.com
May/June 2019
Anticipate Risks to Your Portfolio
When investors work with a financial professional to create an investment strategy, they typically determine their financial goals, level of acceptable risk and time horizon. It is the second factor — risk — that includes a variety of potential challenges you should address when creating and maintaining your strategy.
Prominent Risks
Investors may be aware of market risk, which is present in any security not backed by the United States Treasury. Market risk can cause securities to lose value, either due to specific news about the company whose stock or bond you own, or because of volatility in a sector or the general stock market. That’s why you’re always cautioned to discount past performance when trying to gauge future results when considering equity investments. The same caution about past performance also applies to bonds.Prominent risks involving bonds include inflation risk and interest rate risk. Inflation risk is simply the threat that low-growth investments won’t keep pace with inflation. Interest rate risk occurs when rates rise and a bond’s value declines below its face value because newer bonds offer higher yields.
Other Risks
Your investments may be subject to a variety of other risks. Both stocks and bonds can experience credit risk. If, for example, a company is on shaky financial ground, it could hurt both the firm’s stock price and its ability to keep its promise with a bond.Currency risk occurs when the value of one currency falls versus another. This can hurt stock performance if the company does business in the country or region with the poorly performing currency. For example, if your foreign stock purchased at par achieves a return of 10% in a currency that now pays 90 cents to the U.S. dollar you would effectively earn 9%.
Bonds can also experience liquidity risk when the seller has difficulty finding a buyer. If you own foreign investments your holdings could be subject to political risk, which can affect both stock prices and the ability of affected countries to pay their debt.
Learn more about the risks in your investment portfolio by regularly reviewing your holdings and your strategy with a financial professional.
GE-2314425a (11/18)(Exp. 11/20)
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Duly registered and licensed financial professionals offer securities through Equitable Advisors, LLC (NY, NY 212-314-4600), member FINRA,SIPC (Equitable Financial Advisors in MI & TN), offer investment advisory products and services through Equitable Advisors, LLC, an SEC-registered investment advisor, and offer annuity and insurance products through Equitable Network, LLC (Equitable Network Insurance Agency of Utah, LLC in UT; Equitable Network of Puerto Rico, Inc.). Equal Opportunity Employer - M/F/D/V. Equitable Advisors and its associates and affiliates do not provide tax, accounting, or legal advice or services.
R.I.C.H. Planning Group, LLC is not owned or operated by Equitable Advisors or Equitable Network. GE-6572038.1 (4/24)(Exp. 4/26)
CFP® and CERTIFIED FINANCIAL PLANNER™ are certification marks owned by the Certified Financial Planner Board of Standards, Inc.
These marks are awarded to individuals who successfully complete the CFP Board's initial and ongoing certification requirements.
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