Salient to Investors:

Moshe Milevsky at York University says:

  • People with stable careers and regular paychecks – tenured professors, accountants, nurses etc. – should invest in bonds.
  • People with variable incomes tied to the market or economy – salesmen, brokers, home builders, entrepreneurs etc. – should buy stocks.
  • The most important asset of anyone not born wealthy is their career. The average 25-year-old’s human capital accounts for 99 percent of their personal balance sheet – current and future salary are far more important than savings. Only at age 55 does investment portfolios become about equal in value.
  • Investors with employment linked to major sectors such as oil or technology should avoid broad index funds because of potential industry overlap, but instead buy portfolios of individual industry ETFs to cover every sector but their own.
  • An engineering or medical degree produces a 12 percent annualized return. A degree in anthropology produces a negative 3 percent annualized return.

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