Take a knowl­edge-based ap­proach to your in­vest­ment port­fo­lio

Six must-knows about your in­vest­ment

Moose Jaw Times Herald - - OPINION - Gale Toews Fi­nan­cial Ad­vi­sor

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.

Know your­self

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.

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