Have you ever wondered what a well-known expert does with his own money while giving you advice on how to invest?
A recent article in the AARP Bulletin (December 2021) interviewed Jim Cramer who for 16 years hosted Mad Money with Jim Cramer on CNBC. Maybe you’ve seen his lively, loud, and sometimes silly investment show.
While his show highlights the stocks that he says might outperform the market, half his money is in cash and 80% of the balance is in U.S. stock index funds. How TV Finance Expert Jim Cramer Invests His Own Money (aarp.org).
Granted, he has to comply with ethical restrictions, like not buying or selling what he is touting. He says that for many people, trying to buy the stocks that might beat the market is a bad idea.
Jim understands that the stock market is a very counterintuitive thing. It could be that when the economy is bad, the market is good. And when the economy is good, the market could be bad.
He goes on to say that stocks might not reflect what is going on in a particular company, the products they make, or how their sales are doing, but the price might reflect what’s going on in the stock market. The company might be doing great, but the share price is depressed because of the sector they’re in.
This is one of the reasons I love real estate. Not only does it fit my control issues, but whether the values fluctuate up or down, my rental income is steady.
When it comes to investing you don’t have to follow what you hear from the experts. You don’t need to do what I talk about either.
What you do have to do is invest in the ways that are a fit for you, your personality, and what would be comfortable with your partner as well.
To Your Prosperity,
Rennie
