Portfolio Power Moves: A Masterclass in Diversifying Your Investments

Dec 15

No matter if you're riskin' it for the biscuit or keeping your investment game safe and low-key, we've got the ultimate guide on what your portfolio needs.

Ready to level up your financial game, witches? We’re dishing how to rule your investment game and build a killer portfolio. From emergency funds to crypto, we've got the deets on diversification that even your financial advisor would applaud.

Stocks

Alright, witches, let's spice up that stock portfolio with a killer mix of high-growth babes and some low-key, reliable frens. It's time to channel your inner Witch of Wall Street and conjure up a portfolio that's got growth written all over it. So, pick your poison – whether it's a skyrocketing tech sensation or a more low-key charmer – and let's make those stocks werk for you. It's all about that balance, babe.

Index Funds

Keep it low-key but effective with index funds. These funds track the market, offering a diverse mix without the stress of picking individual stock winners. It's like letting your money go on autopilot while you focus on what truly matters – like being stress-free.

Crypto

Dive into the crypto, but keep it practical. Allocate a percentage of your portfolio to high-risk, high-reward cryptocurrencies like Bitcoin or Ethereum and dollar cost average so you don’t go all in when crypto is riding high. But, babes, here's the tea – once you've snagged your crypto goodies, don't just let them chill on the exchange. Oh no, darling, you gotta transfer those digital treasures to a wallet. Safeguard your gains, secure your assets – because in the wild west of crypto, you gotta play it smart.

Savings Account

Secure the bag with a high yield savings account (HYSA). It might seem basic, but having extra cash on hand is always essential. You'll thank yourself later.

Retirement Accounts (IRA and 401k)

Plan for the future with retirement accounts. Contribute regularly to your IRA or 401k, and let compound interest work its magic. You might not be retired on a beach just yet, but your future self will send you a thank-you card. If the company you work for matches — even better. (Free money, babe!) We’ll share more about retirement accounts in a future blog post.

Emergency Fund

Expect the unexpected with an emergency fund. Having an emergency fund is like having your financial BFF on speed dial – it's the secret sauce to adulting. Life can be unpredictable, and it’s not always rosé all day. Your emergency fund is your safety net for those 'OMG, my car broke down’ or ‘F*CK, my job laid me off’ moments and other major emergencies.

Risk Factor Defined

Alright, witches, let's talk risk factor – it's like choosing between a hot but unpredictable date and a reliable but less thrilling dinner at home. Risk factor measures the level of uncertainty and potential financial loss associated with an investment. A high-risk investment has the potential for higher returns but also a higher chance of significant loss. Conversely, low-risk investments are more stable but offer lower returns.

High Risk (10) Portfolio

Crypto (40%): Embrace the volatility with a significant crypto allocation.
Individual Stocks (30%): Roll the dice on hot stocks with massive growth potential.
Index Funds (20%): Keep it spicy with a mix of high-risk index funds.
Savings Account and Emergency Fund (5%): A small safety net
Retirement Accounts (5%): Dabble in high-growth opportunity stock options within your retirement accounts.

Medium Risk (5) Portfolio

Crypto (25%): Keep things interesting with a moderate allocation to cryptocurrencies.
Individual Stocks (20%): Strike a balance between growth potential and stability with carefully chosen stocks.
Index Funds (30%): Opt for a mix of moderate-risk index funds to diversify your holdings.
Savings Account and Emergency Fund (15%): Maintain a reasonable cash reserve for flexibility.
Retirement Accounts (10%): Balance growth and stability within your retirement accounts.

Low Risk (1) Portfolio

Index Funds (45%): Prioritize stability with a higher allocation to low-risk index funds.
Savings Account (20%): Build a robust cash cushion for added security.
Retirement Accounts (20%): Continue to focus on stability and long-term growth.
Emergency Fund (10%): Be prepared for unexpected expenses with a slightly larger emergency fund.
Crypto (5%): Introduce a minimal allocation to cryptocurrencies for a touch of diversity without significant risk.

There you have it, witches – the ultimate guide to diversifying your portfolio. Whether you're all about that crypto life or playing it safe with index funds, remember, the key is finding the perfect mix that suits your financial goals and risk tolerance. And don’t sleep on investing, the earlier you’re in, the more time your money has to make some major moves.

Don’t forget to base your risk factor off where you are in life. If you're living your best life in your 20s, you can invest more and hold riskier assets because, duh, you can practically live off ramen. (If that’s your thing.) As you adult into your fabulous 50s and retirement is within eyesight, you can dial down the risk level – your future self in that beachfront villa will thank you.

This rule should just be serve as an example, as it does not reflect everyone's situations. Student loans and entry-level jobs are real witches! Invest what you can and is possible within your lifestyle.

Now go forth and secure that financial bag! 💸💅

Want More?

We know money has magical powers. Crypto Witches harness our power through self custody, collective ownership, and financial independence. Join the club to connect with others also demystifying their financial future.