Another reason to spread your investments. I can think of three good reasons to hold lots of different shares, as opposed to one or just a few. Two reasons are obvious, but one is less so, even though it may be just as important.
Q&As: Buying a share on a rumour; Retiring at 40 (2 Q&As); Investing student loan money.
Q&As: Can he retire?, 40-year-old asks; Couple about to retire wonder if their expenses will drop as they get older; Student loan interest ends. What happens if you go overseas?
Q&As: Stick with share fund investments; Is it wise to depreciate if you’re selling your rental quite soon?; Tax treatment of the expenses of rebuilding leaky rental property.
Q&As: Man panicked and bailed out of share fund. No!; Real Estate Institute denies that it’s hard to buy a house in NZ.
Q&As: Eftpos v credit cards. And bank fees; The investment outlook is gloomy, so save!; Wealth doesn’t make you happy.
Q&As: Is compounding interest over-rated?; Credit cards v eftpos; How long is long-term? Returns on different assets.
Q&As: Couple reluctant to sell their shares in a takeover; Owning 19 shares is good, but it’s too soon to judge performance.
Q&As: Man who has made $3 million from shares; How much risk for a 53-year-old?; How good is advice from banks?
Negative gearing may come back to haunt you. Many landlords say they don’t mind or even like to be negatively geared — making year-by-year cash losses on a mortgaged investment. But it never looked all that appealing to me. And recently I heard a rather compelling argument against it.