Mutual funds are supposed to be safe, right?
Tell that to the millions of people who have been invested the last decade and have made little or no money — or worse yet, they have lost money.
Warren Buffett, the only man to make nearly $200 billion by investing, and his multibillionaire partner Charlie Munger believe that diversification is no protection against ignorance.
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Buffett says that the real risk is buying a poor security at any price — or even a good security at a poor price level. For instance, Buffett's purchase of American Express during the "salad oil" scandal of 1963 had him put 40 percent of the partnership's assets into one asset.
Buffett, in his speeches to college students, is famous for describing an investing card as only having space for just 20 punches in your entire investment career. He says, given this mentality, an investor would be much more careful about what he or she is invested in.
Now the question is: Do you want to follow what multibillionaires do or not?
Instead of collecting 1 percent or 2 percent on your hard-earned money join the thousands of people worldwide who have followed my Dividend Machine for the past 18 months.
Not only should your monthly income increase, but you will have the chance for long-term capital gains as well.
You can’t fight inflation; it’s as real as gravity. And in this economic atmosphere, how many folks will demand (and actually get) a raise from their boss?
But you can invest in the finest U.S companies, many with little or no long-term debt and billions of cash on their books.
Those who buy U.S Treasury bonds certainly can’t say that, can they?
About the Author: Bill Spetrino
Bill Spetrino is a member of the Moneynews Financial Brain Trust.
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