Stress-free investing (or at least, close to it)

Dollar-cost averaging is one strategy to mitigate the risk of being wrong about the market. It involves regularly buying a fixed dollar amount of a particular investment, regardless of the share price, so over time, you will have a lower average shar
Dollar-cost averaging is one strategy to mitigate the risk of being wrong about the market. It involves regularly buying a fixed dollar amount of a particular investment, regardless of the share price, so over time, you will have a lower average share price.PHOTO: AGENCE FRANCE-PRESSE

The severe jolt that rocked global markets early this the year, after 12 months or more of bullish gains, spooked plenty of investors. It was a sharp reminder that shares can fall just as fast as they can rise. Invest editor Lorna Tan lists four approaches that will provide some peace of mind, regardless of where the market is heading.

Not putting all your eggs in one basket is a sensible rule for retail investors. You can diversify by spreading your investments over different securities in various asset classes.

The Investment Management Association of Singapore (Imas) says diversifying gives you a portfolio that can weather the ups and downs of economic cycles and market volatility.

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A version of this article appeared in the print edition of The Sunday Times on May 20, 2018, with the headline 'Stress-free investing (or at least, close to it)'. Print Edition | Subscribe