August 2008

Barnett & Company favor diverse portfolios, calmness

The phones of financial planners around the country are ringing off the hook these days with calls from nervous investors worried about their portfolios. At investment firm Barnett & Co. in downtown Chattanooga, those calls come daily and Chris Hopkins knows he needs to ease his clients’ minds.

“That’s a substantial part of what we’re doing these days — reassuring them,” said Mr. Hopkins, vice president of investments at Barnett & Co.

For anyone with money tied up in Wall Street through either 401(k) plans or stock portfolios, local financial advisers first recommend that their clients stay calm.

And while all financial advisers have different approaches, Mr. Hopkins suggests that people who are new to the market stick with fund investing, such as mutual funds or index funds. Those types of investments offer diversification and broad exposure to different types of stocks, he said.

But if choosing that route, he advises that people watch their costs to ensure the expenses involved in managing the fund don’t cut into the fund’s payback.

Before focusing on what to do with their portfolios, however, Mr. Hopkins said most people should take a look at their finances. For people concerned about the economy continuing to weaken, he suggests they try to reduce their overall debt, first of all.

“We’re in an environment where interest rates are likely to go up and borrowing costs are going to increase, especially if during the boom times we got a little overextended with credit, then it’s a time to be looking at trying to reduce personal debt as much as possible,” he said.


Return to previous