Wednesday, November 24, 2010

Investment Risk Pyramid

After deciding on how much risk is acceptable in your portfolio by acknowledging your time horizon and bankroll, you can use the risk pyramid approach for balancing your assets.

  • An investment pyramid actually represents three levels of investment. At the bottom of the investment pyramid, low risk investment options are placed. 
  • In the middle portion of the pyramid, the investment options have a greater risk associated with them. However, these investment options can give you better financial returns than the extremely low risk ones. 
  • The third and the topmost portion consists of extremely high risk investment options. Though the profit from such investments can be unbelievable, you also stand at a high risk of losing your money due to volatile market conditions and overall nature of the economy. 
Personalizing your Pyramid 
Define the overall parameters of the portfolio. Each investor is different and one investor may not tolerate the same risk as another investor. Those who want more risk in their portfolios can increase the size of the summit by decreasing the other two sections, and those wanting less risk can increase the size of the base.

You must understand your goals, priorities and financial aim in your life and then decide which investment would suit you. The pyramid representing your portfolio should be customized to your risk preference.

Tuesday, November 23, 2010

Article sharing: Determining Risk

You might be familiar with the risk-reward concept, which states that the higher the risk of a particular investment, the higher the possible return. But, many investors do not understand how to determine the level of risk their individual portfolios should bear. This article provides a general framework that any investor can use to assess his or her personal level of risk and how this level relates to different investments.

Risk-Reward Concept
Anytime you invest money into something there is a risk, whether large or small, that you might not get your money back. In turn, you expect a return, which compensates you for bearing this risk. In theory the higher the risk, the more you should receive for holding the investment, and the lower the risk, the less you should receive.

Located on the upper portion of this chart are investments that offer investors a higher potential for above-average returns, but this potential comes with a higher risk of below-average returns. On the lower portion are much safer investments, but these investments have a lower potential for high returns.

Determining Your Risk Preference
With so many different types of investments to choose from, how does an investor determine how much risk he or she can handle? Every individual is different, and it's hard to create a steadfast model applicable to everyone, but here are two important things you should consider when deciding how much risk to take:

  • Time Horizon Before you make any investment, you should always determine the amount of time you have to keep your money invested. If you have $20,000 to invest today but need it in one year for a down payment on a new house, investing the money in higher-risk stocks is not the best strategy. The riskier an investment is, the greater its volatility or price fluctuations, so if your time horizon is relatively short, you may be forced to sell your securities at a significant a loss.

    With a longer time horizon, investors have more time to recoup any possible losses and are therefore theoretically be more tolerant of higher risks. For example, if that $20,000 is meant for a lakeside cottage that you are planning to buy in ten years, you can invest the money into higher-risk stocks because there is be more time available to recover any losses and less likelihood of being forced to sell out of the position too early.

  • Bankroll
    Determining the amount of money you can stand to lose is another important factor of figuring out your risk tolerance. This might not be the most optimistic method of investing; however, it is the most realistic. By investing only money that you can afford to lose or afford to have tied up for some period of time, you won't be pressured to sell off any investments because of panic or liquidity issues.

    The more money you have, the more risk you are able to take and vice versa. Compare, for instance, a person who has a net worth of $50,000 to another person who has a net worth of $5,000,000. If both invest $25,000 of their net worth into securities, the person with the lower net worth will be more affected by a decline than the person with the higher net worth. Furthermore, if the investors face a liquidity issue and require cash immediately, the first investor will have to sell off the investment while the second investor can use his or her other funds.

Sources of article: Investopedia

Thursday, November 18, 2010


孩子一出世 ,就有不少保险员来推销教育保单,到底哪一种教育保单最好呢?







Tuesday, November 16, 2010

Investment Risk Tolerance

An important part of investing is understanding your risk tolerance. Risk tolerance is an investor's ability to handle declines in the value of his/her portfolio. An investor's risk tolerance varies according to age, income requirements, financial goals, etc.

There is possibilities that investors might lose some money during investment.

If you can afford to lose more money, you can take bigger risks and aggressive stocks and funds, and in the currency market. However, if you cannot afford to lose a great deal of money, it is vital that you do not invest as much of it, and that you stick to more conservative stocks and funds. You may not make as impressive returns, but you will at least be less likely to run into a situation where you are financially ruined by your losses.

In order to understand your own risk tolerance, you should:
1. Look at how much money you have, and how much money you can afford to lose.

2. Can you stand to lose the money? Will you be constantly stressed about the performance of your investment?

3. Starting with a more conservative investment as they get used to the idea, and then moving to riskier investments as they earn money and become more comfortable with the investment process.

Monday, November 15, 2010








Friday, November 12, 2010



这门课称为“社会与生育健康教育social and reproductive-health education”,为了克服社会上日益严重的弃婴问题。





Malaysia's first school for pregnant teenagers, an initiative directly aimed at curbing the rising numbers of abandoned babies, opened in September in central Malacca state.


Wednesday, November 10, 2010



他指出,目前的中学生对历史科都不感兴趣,依及格率来看,马来文在过去可达至70%-80%,而历史科却只有40-50%的及格率,因此教育部将会进一步探讨这个问题,确保中学生能适应这项新制度。”————风云时报2010-10-24 18:51:58