(This is a Chapter Exerpt from a book on Investing Ghost written by Glenn Hefley -- this is chapter 7 -- Personal Investing Online)

Online access is the greatest development in the last century for personal investors. All levels of investing have benefited from this explosion of information and communication, but the personal investor has reaped the greater portion of the pie. Information and access to other investors, and investor groups have given the home researcher tools that use to take brokers and advisors decades to create and groom. This isn't to say that all of the information out there on the internet is "real" or "correct", but a good portion of it is, and there are more than enough resources to place you in decision making positions.

To be accurate, it really isn't the Information age, but rather the Communication age. The computer started out as a source of information storage and access. Spread Sheets were quite nice to crunch some numbers and databases for notes were good tools. When the computer was connected to the internet and given access to other investors however, it became a tool of communication. Email, news groups, news websites, personal and company blogs, as well as investor forums sprang up give the personal investor access to a huge community of people looking for real information.
Continued Here -> »

Example -- Book, Example -- Finance, Glenn's Work

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While no one can accurately predict the market, we can predict that the market will often be unpredictable. For many investors, this uncertainty can be difficult to swallow. At {$firm}, we can advise you in developing strategies to help mitigate risk and focus on long-term returns. One strategy we’d like to introduce to you is called dollar cost averaging.

Dollar cost averaging is based on the principal of investing a set amount of money every month in the same stock or mutual fund. By doing so, the investor reduces their amount of risk. This is because when the market is down, the same amount of money will buy more shares. Contrarily, when the market is up, that money buys fewer shares. The end result is an evening out of your investment cost basis.

We can help you to determine just how much you should be investing each month to reach your goals based on your particular financial situation, as well as determine appropriate stocks or mutual funds with which you could invest regularly.

Dollar cost averaging is a disciplined and consistent approach to investing that can help you to meet your long-term investment goals. By utilizing this strategy, you can put less emphasis on current market conditions, and pay more attention to your long-term growth. Let us help you to keep your cool in the face of short-term market fluctuations. We can help you develop a dollar cost averaging plan that works for you.

Example -- Finance

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Not only is it impossible for even the most seasoned market professionals to accurately time the market, but not being invested during only a few of the markets’ highest performing days of the year can greatly decrease your portfolio’s return.

To understand the real risk of the stock market, it’s important to understand the risk of not being invested in the stock market. Historically, the safest long-term investment for the preservation of purchasing power has been stocks. In fact, with dividends reinvested, large company stocks have produced positive returns in over 93% of all the rolling 5-year periods (a new one starts every month) since 1926. 1

Consider the following examples that illustrate the risk of not being invested over just a few of the best days or months of the year.

• A $1,000 investment in the S&P 500 at the end of 1981 would have grown to $25,584 (including reinvested dividends) by the end of 1998. However, if you missed the 30 days with the highest percentage gain of those 4,400 trading days, your investment would have grown to only $4,549. The difference is 82%. 1

• A $1000 investment in 1978 would have grown to $21,750 in 20 years. However if you missed the highest performing 15 months during this time period, then your investment would have grown to only $6,010, a difference of 72%. 1

Staying invested is one of the most effective investment strategies you can implement.

At {$firm_short}, we’d like to help you build a long-term investment strategy to meet your financial objectives. Let us help you reduce risk with a plan tailored to your needs.

Example -- Finance

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