Investing and How to Use DynaLogic to Assist in your Strategy (A Series)
What Investments do I Buy? - Part 1
Thank you for participating in our recent survey, we’ve been pleasantly surprised at the overwhelming number of respondents. We wanted to share some of the results thus far:
We asked only two questions, Why did you subscribe? What are your top five holdings?
Re: Why did you subscribe:
A: 45% of our subscribers said they subscribed to find out what to Buy or Sell;
B: 26% said they need help knowing when to Buy or Sell;
C: 16% said they simply want to become a better investor.
We believe we can help our subscribers who answered A B or C but perhaps not in the most obvious way…
Before we respond to those who answered A B or C, let us first offer insight behind why Dynalogic was created.
Most investors think investing is first and foremost about maximizing the return on your investments, failing to focus on something much more important……
Successful Investing is first about understanding RISK!
So when it comes to answering, “What to Buy or Sell”, many investors should likely start by understanding the RISK profile of their choices…and the RISK profile of their own personality!
DynaLogic was created to help investors improve their chances of success by helping to prudently manage buying and selling decisions. The riskier the investment the higher the likelihood it suffers from higher volatility. The higher the volatility of an investment’s price, the more difficult it is to manage your emotions and control the timing of when you buy and sell it!
Now that we have set the table:
We don’t know our subscriber’s goals and thus its not our place to recommend specific stocks to them. This would be like offering directions without knowing the destination! However, DynaLogic can help identify what to buy or sell if you have a list of stocks you are considering and you are not sure what and when to actually buy or sell. Dynalogic’s signals track prices over time to help you determine what may be a Buy or a Sell at a particular moment, and also how much you may want to buy and sell based on current and past actual price movements.
Individual equity securities, options, futures etc. carry a much higher degree of risk with the potential of significantly higher returns…. but also…..higher volatility and potential losses.
An investor who purchases risky investments without the disposition, experience and emotional fortitude to navigate the volatility so often found in these investments is doomed to suffer poor returns…..Not because the investments chosen were poor, but far more often, because the investor chose the wrong time to buy or sell those investments.
As to questions 2: What are your top five holdings?
Risk management again was presented as an obvious need for our subscribers. Not only were the most common tickers highly volatile technology stocks, nearly all of the responses listed equity or equity related tickers!
This again confirms to our team that Dynalogic signals may be very valuable to subscribers as they attempt to manage their buy and sell decisions on some of the most volatile stocks in the market.
In addition to many securities we currently track, subscribers listed approximately 35 securities not currently on our list. Dynalogic will work to add more of these names in coming weeks.
Perhaps you have heard of the investment risk pyramid, an asset allocation platform that builds a diversified portfolio of low risk to high-risk assets that have the potential to match your specific risk profile.
Investment plans just like a pyramid are built from the base up. How much you have in low risk, medium risk, and high risk are a function of your own personal needs and risk tolerance. If you have a stable job and a good source of income, you may not need to rely on your investments to meet daily income needs and can afford to take on more investment risk. If on the other hand, you are close to retirement or are currently retired and will be drawing on your investments, then you probably want a higher allocation to the low and middle portion of the pyramid.
Additionally, investing has an emotional component. Some wise investment counselors have instructed their clients to never think about how much you can make, think about what you can afford to lose. This is not only because losses in a portfolio have a disproportionate impact when compared to gains, but also because for many investors a 10% drawdown in the value of their portfolio causes sleepless nights. These investors probably need to dial back the risk of their portfolio and keep a larger portion in lower-risk instruments. Obviously, as your portfolio grows in value, your risk tolerance can also grow allowing you to potentially reap the rewards of higher return assets.
From time to time, your investment plan should be updated as your goals and objectives change, and market conditions change.
DynaLogic’s “Risk-Off” will be with you every step of the way helping you make better investment decisions.
If you are a subscriber, we are glad to have you onboard. Leave us a comment below and let us know how DynaLogic is supporting your goals and how we can continue ti improve.
If you are not a subscriber, subscribe below and receive our free daily buy and signal emails.