AboutDr. Joseph de Beauchamp Expertise Over the decades, I have taught the MBA schools in this subject. I have published on over 2000 public companies. I love to help provide information to the individual and company.
Question my fiance has recently inherited 20000 and has decided to invest it. i told him that when he talked to his financial advisor to only listen and we would get other opinions later since we were new at this. however, he came home and told me the advisor recommended this 1 stock that has never gone down and that he should earn about 1000 dollars a year on it. (4.6%?) does that sound like a good deal? i think that there should be a better way to invest this money to make more. it sounds low when you have 20,000 dollars invested.
any suggestions or explanations?
thank you
jennifer
Answer It is hard to advise a friend on their money. Sounds as if he has already made his bed. Does he have concerns? I would choose a different course, and would maybe recommend a mutual fund for more of a spread of risk. One stock for an investment is difficult to accept from the fact that it is only one stock. Most people today do better in diversified fund with hundreds of stocks.
I would not have recommended a single stock to anyone, since only one stock does not spread the risk enough. People should only toy with the stock market with a long time horizon and be able to buy 10 or more stocks to spread the risk.
