Take a knowledge-based approach to your investment portfolio
Six must-knows about your investment
The future does not have a hold button when it comes to your investment portfolio. And today’s markets — which have left many investors uncertain and on the sidelines — are no exception.
How the future and your portfolio unfolds depends on what you do right now. Waiting for an all clear signal in today’s market can be time wasted and opportunity lost.
It’s in times like these that investors should focus on what they know and let investment knowledge bring some certainty back to investment decisionmaking. Developing a knowledgebased approach to investing can build confidence and momentum.
Markets aren’t the only things that change; investors do too. Not only do you experience major lifestyle changes over the years, such as marriage, births, and job changes, but your attitudes and investment outlook change too. When this happens, it’s time for a portfolio review and a reconsideration of your portfolio’s asset allocation. Your investment decisions should be consistent with your personal comfort levels.
Know your investments
Market trends and averages are good to watch, but in an unpredictable market, stay focused on the things you know – specific stocks, asset classes, and investment products. Understand what you’re invested in and, just as important, why you’re invested in it. This knowledge is the essence of strategic thinking and the foundation for an investor’s peace-of-mind.
Know your limits
Safety and preservation of capital
have become very important considerations for many investors recently. And rightly so. But a portfolio designed to be risk free may let you sleep better at night right now, but it might not generate the long-term returns you’ll need to sleep soundly in the future.
Safety must be tempered with an eye toward the future spending power that your investments today will generate. Rising inflation can erode the returns of low yielding securities, making them riskier than you think as long-term investments. Be careful about the limits you set on your investments. They may be riskier that you think.
Know your RRSP better
A Registered Retirement Savings Plan is much more than a place to visit every February with a lastminute contribution. Yes, it provides a tax-sheltered home for your savings
to grow. But it is also an investment portfolio and a financial planning tool. Treat your RRSP with respect, as an asset to be managed strategically and nurtured with regular contributions throughout the year.
Know your investment team
As your financial circumstances change and become more complex, professional accounting and legal advice can make a valuable contribution to your investment decision-making. Put your financial advisor at the centre of your team to work directly with your accountant and your lawyer so you receive the best advice on the strategic direction of your financial affairs. If you would like more information please contact Gale Toews, Financial Advisor, at Gale Toews Private Wealth Management of Raymond James Ltd. at (306)693-4430. Information in this article is from sources believed to be reliable; however, we cannot represent that it is accurate or complete. It is provided as a general source of information and should not be considered personal investment advice or solicitation to buy or sell securities. The views are those of the author, Gale Toews and not necessarily those of Raymond James Ltd. Investors considering any investment should consult with their Investment Advisor to ensure that it is suitable for the investor’s circumstances and risk tolerance before making any investment decision. Raymond James Ltd. is a Member Canadian Investor Protection Fund.
It’s in times like these that investors should focus on what they know and let investment knowledge bring some certainty back to investment decision-making. Developing a knowledge-based approach to investing can build confidence and momentum.