10 Timeless Investing Principles

Investors and retirees looking for reassurance during challenging stock market times can take heart in these time-tested investing principles.

(Image credit: Getty Images)

When times are good, it’s tempting to throw caution to the wind. This is especially true during a strong economic environment. Over the 11-year bull market, which ended in March, stocks rose steadily, companies were able to easily obtain financing, and many professions offered secure paychecks. Many investors took consistent positive returns for granted, and, consequently, made questionable decisions when it came to their personal finances.

To quote legendary investor, Warren Buffett, “You only find out who is swimming naked when the tide goes out.”

Over the past two months, the tide went out fiercely, with the market plunging at a historic pace. In a matter of weeks, the S&P 500 dropped 34% and trillions of dollars in shareholder value vanished. This experience has been a wake-up call that the good times don’t last forever. It’s also a harsh reminder of the dangers of straying too far from a prudent investment plan.

A judicious strategy incorporates timeless investment principles, many of which have become clichés over the years. These investment truths not only help ensure that investors are on track to achieve their financial objectives, they also keep them out of trouble by attempting to avoid financial missteps when times are good. Now is a wonderful opportunity to revisit these principles, as many investors are searching for guidance during these challenging times.

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC (opens in new tab) or with FINRA (opens in new tab).

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Jonathan I. Shenkman
Associate Director - Investments, Oppenheimer and Co. Inc.

Jonathan Shenkman is a financial adviser, portfolio manager and the founder of the Shenkman Private Client Group of Oppenheimer & Co. Inc. He is experienced in developing creative strategies that allow his clients to achieve their retirement, estate and philanthropic objectives.