5 Profitable New Year’s Resolutions for 2011

While the ushering in of the New Year may have you thinking about how you want to take that big vacation this year or lose the 20 or so pounds that eggnog guzzling added to your midsection during Christmas with the family, don’t think that those good old New Year’s resolutions don’t carry over into your investments as well.

Here’s a look at five of this year’s most common New Year’s resolutions – with an investment bent that could add serious value to your portfolio in 2011…

1. Trim the Fat

It’s not just a resolution your significant other has been pestering you about – and jogging isn’t the cure – when it comes to trimming the fat for your portfolio, your money’s on the line!

It’s a very good idea to re-evaluate the stocks and funds in your portfolio on a regular basis. Even if you’re a student of the buy-and-hold school, taking another look at what you own is still a prudent idea from time to time.

When you review your portfolio, review the attributes that made each stock you own look attractive for you in the first place, and see if they still hold – is that company’s new product still a winner? Are any of the mutual funds you’ve invested in managed by  guy named Madoff? Don’t be afraid to re-do your due diligence.

Trimming the fat also means taking a look at how you’re investing, not just what you’re investing in. Knowing whether your portfolio is properly allocated is a great example… After all, there are other asset classes out there – currency trades, precious metals, and commodities are a few examples. (Check out Agora Financial’s premium research services to learn how to put these investments to work for your portfolio immediately…)

2. Quit Stressing… About Your Investments

Stress isn’t healthy, so why let your investments add to it? I’ll admit, this one’s harder to accomplish, but the benefits are well worth it. Don’t forget that while the average life expectancy here in the U.S. is 77.8 years, you’ve got to subtract a decade or two if you have an obsession with watching the market.

Are you one of those investors who needs to take a look at the market non-stop throughout the day? Consider picking up a copy of Dr. Brett Steenbarger’s The Psychology of Trading – in it, one of the financial world’s leading trading psychologists offers up a number of tips and tricks designed to help you trade better.

That brings us to our next resolution…

3. Learn Something New

Whatever the balance in your brokerage account, knowledge is (hopefully) one of your greatest assets. If there’s a part of the investing world you want to learn about – the basics of technical analysis, for example – why not take the time this year to expand your horizons?

Luckily, this is one of the easiest resolutions to fulfill in the New Year, all you need to do is open your email inbox for our next issue, or visit PennySleuth.com to check out our free Research Report library filled with tutorials on everything from penny stock basics to technical analysis training.

4. Help Those Less Fortunate

I’m not just talking about donating to charity here (although don’t forget, you can make tax-deductible charitable contributions of stock). What better to do with your newfound investment knowledge (see the previous resolution) than to share it with friends, family, and whomever else needs some “expert insight” for their portfolio?

After all, “financial” is a foreign language to most people. From passing on an informative article (hint, hint) to walking someone through how to execute a trade, don’t be afraid to have a hand in getting someone else’s investing smarts on track.

One thing to remember – money’s on the line, so when in doubt refer people to a financial professional.

5. Get Organized

If you’re an active investor, one of the best resolutions you can have is to get organized. Being successful in the investing world often comes down to your decision-making abilities, and disorder can easily get in the way of making smart investment choices.

To help get things in straightened out, consider a free secure service like Mint.com, which puts all of your financial accounts – like your brokerage, checking, and credit cards – in one place.

Finally, go electronic for things like trade confirmations and your broker-related tax forms. Not only will going digital de-clutter your life, it’ll ensure that nothing’s missing when it comes time to files all of those capital gains you’re sure to have next year with the IRS. Most of the time, this stuff is available directly from your broker’s website.

And if your trading leaves something to be desired, consider synthesizing your thoughts with a trading journal. Remember, at any given time you should be able to quickly detail precisely what your personal rate of return on your brokerage accounts looks like. Don’t wait until year-end to gauge your performance.

Resolved to Invest Smarter

If you’re one of those people whose New Year’s resolutions are long forgotten by February, take heed – you won’t want to file these away with cleaning the garage and learning a language. Gains have been hard won in 2010; with New Year’s resolutions for your investments (and more than a little luck), here’s to seeing a more prosperous year in 2011.

Happy New Year,
Jonas Elmerraji
Managing Editor, Penny Sleuth

December 30, 2010

5 Profitable New Year’s Resolutions for 2011 was originally featured in the Penny Sleuth. Check out Wall Street’s 5 Most Profitable Penny Stock Patterns Report.

This story was originally featured on Penny Sleuth.

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