Practical Implications of Investment Theory
Many investment principles used to develop
investment portfolios derive from one investment theory - the
capital asset pricing model. What exactly is this theory, and
how does it apply to your investments? The capital asset pricing model was developed
over 50 years ago by Harry Markowitz, who won a Nobel Prize for
his work. His theory centers on the concept that adding an asset
to a portfolio that is not highly correlated with other assets
in the portfolio can reduce the portfolio's variation risk.
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Using Average Returns in an Investment Program
When setting up an investment program, the
assumed rate of return is typically an average annual return for
some historical period. While that is generally viewed as a conservative
approach, there are some problems with using an average return.
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What Are ILITs?
Typically, irrevocable life insurance trusts
(ILITs) have been used to help pay estate taxes through the use
of life insurance proceeds not considered part of the deceased's
estate. The trust receives the life insurance proceeds free of
estate and income taxes. But with the uncertain future of estate
taxes, you may wonder whether ILITs are still a valid estate planning
strategy.
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Debt Free in 2007
Increasing debt levels can make it difficult
to achieve your financial goals. If a significant portion of your
income is going toward debt payments, that leaves less available
to put aside for your financial goals. While it may be difficult
to achieve debt-free status when you own a home with a mortgage,
it is a reasonable goal to owe no debts other than your mortgage.
To help you with that goal, consider the following steps.
[FULL ARTICLE]
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How Much Do You Need for Retirement?
One of the most critical factors in determining
how much you need to accumulate by retirement age is how much
annual income you'll need in retirement. But if that retirement
date is years or decades away, it may be difficult to come up
with a reasonable estimate of your income needs.
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David K. Sebastian, CFP®, and his team of experts at The Physicians Wealth Management Group specialize in working with individual physicians and group medical practices. David is considered to be one of the top financial advisors in the country with more than twenty five years of Wall Street experience as a chief investment officer, portfolio manager, institutional bond trader, and estate planning, benefits planning and retirement consultant.
Commitment to his clients’ financial needs and well being is a primary motivation for David.
The Physicians Wealth Management Group was specifically created to address and manage all of the unique financial challenges that doctors are facing both individually and through their group medical practices.
Feel free to contact me at
www.physicianswealth.com or
dsebastian@sfr1.com
or call me at (973) 285-3600
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