Portfolio Literacy is dedicated to transparency and promoting free financial literacy for everyone. Here are Portfolio Literacy’s latest blog posts. If you are looking for specific topics, the categories are at the bottom of this page.
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What Was the Yen Carry Trade that Unwound on August 5th?
The Yen Carry Trade was a popular investment strategy that took advantage of Japan’s low interest rates. Investors borrowed money in Japanese Yen at very low rates and then invested that money in assets with higher returns in other countries. This strategy allowed investors to profit from the difference in interest rates between Japan and…
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The 5 Most Popular Portfolio Allocation Models
Investing your money wisely is key to building wealth over time. Portfolio allocation is an important part of investing, it is deciding how to split your capital between different types of assets. The below portfolio allocation models are incredibly common and are good bases for how you may want to allocate your capital. However, your…
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What Are Municipal Bonds?
If you’re looking into investment options, you’ve likely come across municipal bonds. Municipal bonds are debt securities issued by state and local governments to finance public projects like roads, schools, and hospitals. They are appealing to many investors because of their tax advantages; interest earned on these bonds is often exempt from federal income tax…
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How Do Target Date Retirement Funds Work?
Target date retirement funds are designed to simplify your portfolio savings by automatically adjusting your investment mix as you approach retirement age. These funds typically start with a higher allocation to stocks and gradually shift towards more conservative investments like bonds and cash equivalents. This automatic adjustment helps manage risk and aligns with your changing…
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Do I Bonds Fit Into Your Portfolio in 2024? Assessing Inflation-Linked Savings Bonds
Check out our 2025 I Bond post for more insight on inflation and if I Bonds are something you should consider. Assessing the role of I Bonds in your investment portfolio in 2024 is a significant consideration, particularly in an economic climate characterized by uncertainty. These bonds are specifically designed to protect against inflation, which…
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What Are Defensive Investments That I Can Add to My Portfolio?
When market volatility is high, it’s crucial to know how to protect your portfolio. Defensive investments can help you achieve this goal by reducing overall risk. These investment types aim to provide steady returns or reduced volatility even during uncertain times. Defensive investments often include stocks from well-established companies, treasury bonds, ETFs focusing on stability,…
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What is Interest Rate Risk and Why is it Important?
Interest rate risk is the possibility that changes in interest rates will negatively affect the value of your assets or portfolio. This risk can impact both borrowers and investors, leading to losses when unexpected fluctuations occur. Imagine you have investments in bonds; if interest rates rise, the value of your bonds might decrease, as newer…
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How Do Zero-Coupon Bonds Work?
A zero-coupon bond is unique because it doesn’t pay periodic interest. Instead, you buy the bond at a discount and receive its full, face value at maturity. This difference between the purchase price and the face value represents your profit. This makes zero-coupon bonds an attractive option for investors looking for long-term growth without worrying…
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5 Things to Know About Private Equity Before You Invest
Investing in private equity can be an appealing opportunity for many investors looking to gain exposure to private markets and diversify their portfolio. This type of investment involves committing capital to PE firms that buy and sell privately held companies or purchase public companies and take them private. Understanding the key aspects of private equity…
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Why Exposure to Private Markets Provides Better Portfolio Performance
Investing in private markets can significantly enhance your portfolio performance. Private markets offer diversification and can provide resilience during market downturns. By allocating assets into private equity, private debt, and real estate, you tap into sources of return less correlated to the public markets. Exposure to private markets enables you to optimize performance while managing…