The Investor's Advocate: Diversity Dilemma
Pending Challenges to Conglomeration Could Dismantle Long-Used Strategy Which Fuels Most of 401(k) Growth
Could one of the most successful strategies behind the growth of your retirement plan soon become obsolete? And is so, what exactly will replace it? These intriguing queries are addressed in a new posting called "The Potpourri Paradox" (https://www.howtoinvestblog.net/2021/01/the-potpourri-paradox.html) by Anthony Rhodes, on his popular How To Invest blog ((www.howtoinvestblog.net). Mr. Rhodes is the owner of wealth management firm The Planning Perspective (www.theplanningperspective.com).
"As far as investment strategies go, I can't think of any which has had more of a direct impact on capital appreciation than this one." he began. "Diversification is the single most important resource in an investors' toolbox, and while the post covers possible alterations on the micro level, it still could have a definitive effect on portfolio growth." he added. "We'll have to wait and see how it all plays out, but for right now, it certainly qualifies as a cause for concern."
Will the possible changes decrease the overall growth rate of your retirement plan? Or, is it all just much ado about nothing? Mr. Rhodes covers all bases within the post.
"This strategy has faced challenges before, and has always emerged intact. But this time may be different." he explained. "New realities are unfolding which it has never encountered, which may make the assumption of business as usual difficult." he added. "If it can adapt to these changes, it will continue to remain the cornerstone investment strategy which it always has been, and if not we'll have to seek out newer alternatives. It's as simple as that." he closed.
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