Tuesday, September 29, 2009

Understanding Sector Investing

QualityStocks follows many distinct market segments. Biotech to mining, the QualityStocks team works to address investment opportunity in its many forms. In this regard, the team understands diversification and that individual needs should be addressed by registered investment advisors.

The question begins with need and the certain understanding that diversification is paramount. There are distinct market segments to invest in. The leading segments include: industrials, commodities, technology oriented, biotechnology, fixed income (bonds, treasury securities, municipals), REITS (real estate) and a host of other ideas that financial workers have invented.

As one considers what questions to ask a registered investment advisor, think about risk. Although it may be a generalization, the industrials portion is generally considered to be the income portion of a portfolio. Dividends usually flow from these companies (although less of late given current economic circumstance). Municipals, treasuries and bonds also fall into this particular category of providing reliable income. Remember, however, that there are issues associated in this regard so be sure to ask a registered investment advisor about how costs and values can change.

If an investor wanted to invest on the more risky side they might want to consider commodities. Commodities are basically raw materials. These items might include: corn, sugar, gold, oil or natural gas. The thing to remember in commodities is that one does not necessarily need to invest in the actual product. They can also invest in the company that brings the product to market.

In between these two end-point there are a host of industries among which is technology. This area is a bit more difficult for the average investor to understand but can be profitable if approached correctly. In this segment understand the company and sector before investing. THE MAXUM OF NEVER INVEST IN ANYTHING YOU DO NOT FULLY UNDERSTAND APPLIES HERE.

If an investor were to consider a conservative investment strategy, they might consider a fixed income option. If this is the case, consider a registered investment advisors advice. This is a safe move but one that may find ones capital drained by fees and other economic events. Diversification is the key in this case. Spread investments according to need and conditions and not just fixed income.

QualityStocks follows each area described. Information is the real key. If an investor can follow the sector trends that QualityStocks tends to offer, they may be able to better understand which market sectors might better suit their individual investing needs.

About QualityStocks:

QualityStocks’ Small Cap Stock Newsletter is a free service that collects data from hundreds of Small-Cap online Investment Newsletters into one free Daily Newsletter Report.

Sign up for “The QualityStocks Daily Newsletter” please visit www.QualityStocks.net

The Quality Stocks Daily Stock Report http://video.qualitystocks.net

The Quality Stocks Daily Blog http://blog.qualitystocks.net

The Quality Stocks “Ones to Watch” http://Gotstocks.QualityStocks.net

Please see disclaimer on QualityStocks website: http://disclaimer.qualitystocks.net

No comments: