FINANCIAL FOCUS: Celebrate Earth Day by improving your investment environment

Joe Faulk

Joe Faulk

Published: Monday, April 21, 2014 at 08:32 AM.

On April 22, we celebrate Earth Day, which is devoted to education and action on environmental issues. As a citizen of the world, you may have a keen interest in protecting your physical surroundings. And as someone trying to reach long-term financial goals, such as a comfortable retirement, you’re probably also interested in improving your investment environment.

So here are a few suggestions:

Respond to environmental factors. Over the past few years, we’ve had a favorable investment climate, marked by low inflation, low interest rates and generally strong corporate profits. And investors who have taken advantage of this positive environment have, for the most part, been rewarded.

But things can change, so it’s always a good idea to understand the current investment environment, as it may affect your investment choices.

For example, if it seems likely that long-term interest rates will rise significantly, you might need to review your long-term bond holdings, as their price would be negatively affected by a rise in rates.

Nurture your investments. One area of environmentalism involves planting seeds or saplings and nurturing them to maturity. You can do the same thing with investments — and a good way to nurture them is to give them time to grow in all investment climates.

How long should you hold these investments? Well, you might heed the advice of Warren Buffett, one of the world’s most famous investors, who says this about his investment company: “Our favorite holding period is forever.”



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