Holly has many different types of investments. She does not understand a few of her investments. She is having a hard time figuring out their value and whether she should sell them. What principle of saving and investing should Holly have followed? Understand your risk tolerance. Diversify. Keep investments simple. Look at past performance.

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Arabella Singleton

Business

12 November, 12:10

Holly has many different types of investments. She does not understand a few of her investments. She is having a hard time figuring out their value and whether she should sell them. What principle of saving and investing should Holly have followed? Understand your risk tolerance. Diversify. Keep investments simple. Look at past performance.

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Chase Walker · Answer 1

From what Holly is experiencing, she should have followed a principle of saving and investing which is known as keep investments simple.

The underlying reason for this principle is that trying too much - trying to read the market to gain more dividends by selling off your stocks, buying investment products that you do not understand because of high-return promises - might instead jeopardize your investments, such is the case with Holly.