Retirement investing is different. Buy and hold can work if you aren’t going to need the money for 20 years. Performance measured against broad indexes or other relative benchmarks may be appropriate. However, in retirement, withdrawing money has to happen to cover living expenses. This requires a change in perspective toward personal money management.

Modern Portfolio Theory and trading (rather than investing or speculating) can be combined into a robust strategy for protecting principal and generating postive real returns. By selectively balancing investments in asset classes to maximize return with appropriate level of risk for the individual investor, Modern Portfolio Theory provides a sound foundation for investment decisions.

Trading covers the strategic elements of entering, exiting, and position size and selection for moving money between asset classes (aka money management or capital management).

learn more…

options - puts, calls and futures

• Why Options - OptionsXpress

risk/reward profile

entry

• ?? citation - studies show that entry price and position are of minimal consequence compared to position and exit strategies - both of which are crucial.

exit strategies

• positive outcomes
• negative outcomes
• exercising the calls
• realize the loss
• predetermined stop-loss point
• target as a function of risk
• pivoting out
• exiting into expansion
• profit protection strategy to exit winning trades
• stop loss strategy to get out of bad ones
• fire drill in case disaster strikes
• reward target - price-based exit strategy
• time-based exit strategy

position - plan, monitoring, money/capital managment

• number of positions that can be monitored at one time
• amount of capital and risk that will be committed to each trade
• some options strategies have unlimited risk

related terms and concepts

• “naked” puts
• margin call
• leveraged exposure
• Characteristics and Risks of Standardized Options - The Options Clearing Corporation
• support/resistance level
• moving averages
• strong breakout levels
• momentum

Links to some of the best resources on the web. These are freely available. We have reviewed the information presented and believe that it is a factual representation of the information. Where opinions are offered, they are in line with our thinking on the subject.

Modern Portfolio Theory

• Intro to Modern Portfolio Theory: understand diversification and the Efficient Frontier, find a portfolio with the maximum Sharpe Ratio; why index funds are theoretically optimal.

Stock Valuation

• Learn the logic of stock valuation with a discounted cash flows calculator… plus P/E, P/S and PEG ratios, CAPM, DDM … Buffett’s secret formula (?)

Sources of information

• MoneyChimp MoneyChimp seeks to be the most coherent, logical, useful and accessible financial education resource on the face of the earth

The tag line for the Boomer Project is “research, insight and intellegence for reaching Boomers over 50″

The Boomer Project conducts national research among Boomers and shares those findings on this site, in our free newsletter and in our marketing research report called “50 Things Every Marketer Needs to Know About Boomers Over 50″. A couple of pages are provided free - you get the idea. Boomers are “middle age” - old age begins at 75. They are not “seniors” - that is their parents generation. Most see themselves as 12 years younger than they actually are. That old joke about being forever 39… it isn’t just Jack Benny or vain older women any longer.

Some recent ads targeting 50+ with perks like free checking (Wachovia) were not well received by their intended audience. Some marketers just don’t get it - advising “turn gray into gold” by selling investments to the elderly to hit one of their “G-Spots”, or supposed soft spots: gambling, gardening, golf, gourmet food, grandchildren, groups and Greyhound bus trips. Nope, that doesn’t make me want to run out and spend money.

Boomers are redefining retirement - interesting description of retirement in the April issue of the Boomer Project newsletter from a reader in response to the March issue. Basically, they are planning to do the work they think they will love better than their current job. These new jobs are outdoors, recreational, travel related and-or physical.

They want and need special treatment. They are not the 25-49 “adult” demographic. But they do have buying power and influence. Many marketers are missing a growing demographic.

This also presents a problem for AARP - membership open to anyone over 50 = admitting being a “senior” - not happening. Nor do all 78 miliion Boomers want to be represented by the views expressed by the AARP. New organizations are forming that reflect the views of subset of the Boomer population. National Association of Baby Boomer Women

Web and media resources are springing up including Growing Bolder - the world’s first and only multimedia website that celebrates active aging.

Baby boomers are also in “denial” about retirement and the need to save and plan, says Matt Thornhill of The Boomer Project … “As a generation, boomers feel they don’t have to worry about retirement yet,” … boomers think middle age lasts from 48 to 73 and old age begins at age 74. … they plan to retire at age 68 … no idea what they will do in retirement.

… an educational approach helps boomers feel as if they are in control. “The message needs to be ‘what are you doing right now to make sure you maintain control over your financial future?’” Thornhill said.