The key here is that you will make money in the stock markets only if you can stay invested in it for the long haul. The earlier you begin investing in the stock markets, the greater will be your long-term returns as the power of compounding works for you.
Even if you are nearing your retirement you should still consider investing a part of your funds in good quality stocks for the long-term. After all, the average American’s lifespan, according to the CDC, is 78.6 years. This means that even if you are 50 today, on average you still have nearly three decades more to live.
Seasoned investors know that there is no surefire winning investment and that the future is unpredictable. If you are not a market veteran and you want to shock-proof your investment portfolio, put the biggest chunk of your savings in index funds and established dividend stocks. This will eliminate the role of guesswork and intuition and help ensure that your capital is preserved and thriving for the long run.
Beating the stock market consistently over a long period of time is an extraordinary feat, one which only a few investors in history have managed to achieve. In the final analysis, you will be much better off if you invest in index funds linked to a broad market index such as the S&P 500. You will not outperform the market with this strategy, but you will also not get decimated either.
Some of the most time-tested, highly respectable companies with global brand domination have an outstanding track record of producing profits consistently and paying solid dividends. If you do not wish to focus on capital gains alone and want to create a regular income stream, invest in dividend-paying stocks of companies with a reputation for dependability.