Make sure to subscribe to the new blog.
Good night and good luck!!
Thursday, July 10, 2008
Tuesday, July 8, 2008
New Articles On The New Blog
To subscribe to the new blog click here.
Latest articles are following the theme on debt and debt reduction.
Enjoy and please comment.
Latest articles are following the theme on debt and debt reduction.
Enjoy and please comment.
Monday, July 7, 2008
New Blog Location
Please resubscribe via this link http://www.financialmanagementpartners.com/wordpress. A number of articles have been written and ready to be posted. Some are already there.
You will find similar email subscription links and RSS feeds.
The remainder of the site is still under construction. In the meantime, visit http://www.termchoice.ca. We have launched an online life insurance quoting system. It is easy to use and will save you money.
More to come from us. We are going to be launching a new software suite in the coming days along with the FMP site and the possibility of a specialty RESP site.
Look forward to more news.
You will find similar email subscription links and RSS feeds.
The remainder of the site is still under construction. In the meantime, visit http://www.termchoice.ca. We have launched an online life insurance quoting system. It is easy to use and will save you money.
More to come from us. We are going to be launching a new software suite in the coming days along with the FMP site and the possibility of a specialty RESP site.
Look forward to more news.
Friday, March 28, 2008
UNDER CONSTRUCTION
Big News To Come: Financial Strategies Today will be undergoing a complete renovation. Will keep you posted....
Wednesday, February 13, 2008
Are You On Track with Your Plan?
In my time in finance I have seen a lot of younger (and older) people start from scratch in their financial paths. One of the things that can be an easy trap to fall into is having a whole portfolio based in equities. This can easily happen in a bull market especially when dealing with the 'marketing machines' that are driving what we are faced with in the investment world.
When dealing with stocks and mutual funds it is easy to get caught up in this and you may not even know it.
So let's take a step back and analyze what a good portfolio is aimed to do (for the average investor): Ideally when setting a goal (such as retirement) the idea is to earn a modest return (let's say 8-10%) over a long-term period. The degree on which that can fluctuate is also based on the risk/return model you as an investor can comfortably accept. When using mutual funds, it is a long-term matchup with a money manager that suits your goals and risk tolerance.
When faced with volatile markets and sharp ups and downs as we have seen as of late it forces investors to remind themselves that there is a much bigger timeline when considering entering the markets. That is why we DON'T invest all our money in GICs (see my article on that).
Many young investors have only had the opportunity to take part in the bull market of the last five years. This is a wake up call for many. I feel it is a great time to take part in market opportunities.
So, when times like this occur we all take a step back and remember what it takes to set up a quality portfolio. Larry Swedroe in Rational Investing in Irrational Times provides the following guidelines for the maximum equity exposure depending on time horizon:
0 to 3 years - 0%
4 years - 10%
5 years - 20%
6 years - 30%
7 years - 40%
8 years - 50%
9 years - 60%
10 years - 70%
11 to 14 years - 80%
15 to 19 years - 90%
20 years or longer - 100%
It corresponds with my previous article stating that if you need your money in a short period of time the market is no place for you.
This is a great time to step back and look at portfolios to make sure that they are in check with your actual plan. I have always discussed the relationship between institutions (banks, mutual fund companies, etc) and what it actually takes to attract new money. This often may throw a clients long-term objectives out of wack.
Some funds that have maintained long-term objectives without over exposing themselves in down markets:
CI Harbour
Fidelity Canadian Asset Allocation
Dynamic Power Balanced
.......make sure you look before you leap, keep with the plan, and never hesitate to ask questions. Now is the time.
When dealing with stocks and mutual funds it is easy to get caught up in this and you may not even know it.
So let's take a step back and analyze what a good portfolio is aimed to do (for the average investor): Ideally when setting a goal (such as retirement) the idea is to earn a modest return (let's say 8-10%) over a long-term period. The degree on which that can fluctuate is also based on the risk/return model you as an investor can comfortably accept. When using mutual funds, it is a long-term matchup with a money manager that suits your goals and risk tolerance.
When faced with volatile markets and sharp ups and downs as we have seen as of late it forces investors to remind themselves that there is a much bigger timeline when considering entering the markets. That is why we DON'T invest all our money in GICs (see my article on that).
Many young investors have only had the opportunity to take part in the bull market of the last five years. This is a wake up call for many. I feel it is a great time to take part in market opportunities.
So, when times like this occur we all take a step back and remember what it takes to set up a quality portfolio. Larry Swedroe in Rational Investing in Irrational Times provides the following guidelines for the maximum equity exposure depending on time horizon:
0 to 3 years - 0%
4 years - 10%
5 years - 20%
6 years - 30%
7 years - 40%
8 years - 50%
9 years - 60%
10 years - 70%
11 to 14 years - 80%
15 to 19 years - 90%
20 years or longer - 100%
It corresponds with my previous article stating that if you need your money in a short period of time the market is no place for you.
This is a great time to step back and look at portfolios to make sure that they are in check with your actual plan. I have always discussed the relationship between institutions (banks, mutual fund companies, etc) and what it actually takes to attract new money. This often may throw a clients long-term objectives out of wack.
Some funds that have maintained long-term objectives without over exposing themselves in down markets:
CI Harbour
Fidelity Canadian Asset Allocation
Dynamic Power Balanced
.......make sure you look before you leap, keep with the plan, and never hesitate to ask questions. Now is the time.
Thursday, February 7, 2008
Market Blips
Here is some interesting food for thought:
1. Since 1950 there has never been a 10 year rolling period where the TSX lost money. The lowest 10 year average rate of return was 3.3% was from September 1964 to September 1974. The best 10 year average rate of return was a whopping 19.5% from August 1977 to August 1987.
2. The lowest 30 year average rate of return was 8.6% from June 1952 to June 1982. The highest: 12.7% from August 1970 to August 2000.
3. The single worst 1 year rolling period for the TSX was June 1981 to June 1982 during which time the index lost a massive 39.2%.
4. The single best 1 year rolling period for the TSX was the very next year from June 1982 to June 1983 when the market returned 86.9%.
Cited from “RRSPs” Preet Banerjee 2007
On that note, have a look at the recent Wealthy Boomer article stating that Warren Buffett is a “huge bull on the U.S. economy’. A comforting article given all the recent short term volatility we have seen.
While a complete recovery may not be right around the corner (see yesterday's Globe & Mail article on Buffett ) numbers will tell you again and again that down markets usually last 5 times less than up markets.
My last article focused on the fact that it is better to do nothing with present in a down market. For people invested with a good timeframe that is the best strategy. However, for those looking to invest new money and take advantage of times like these the question is: when is it time to take advantage of a market downturn?
In the last year the highest month for mutual fund sales was in June and the lowest was last month. With the TSX being at it's peak in June this can be seen as a direct correlation to how investors are controlled by emotion in the markets. Last month alone RBC saw a net $1.9 billion assets move into money market to escape the risk of equities.
Being an advocate of long-term, conservative investing it can be obvious in hindsight how emotions can control market timing.
"Far more money has been lost by investors in preparing for corrections, or anticipating corrections, than has been lost in the corrections themselves." Peter Lynch, Worth (September 1995)
Also, being an advocate of the advantages of long-term leverage a correction or down market is the best time to maximize returns (especially given the numbers and long-term trends above). This is one of the topics that I will be discussing on the CFRA program on Saturday.
I will finish with a link to an amazing article from Larry Swedroe . Enjoy!
1. Since 1950 there has never been a 10 year rolling period where the TSX lost money. The lowest 10 year average rate of return was 3.3% was from September 1964 to September 1974. The best 10 year average rate of return was a whopping 19.5% from August 1977 to August 1987.
2. The lowest 30 year average rate of return was 8.6% from June 1952 to June 1982. The highest: 12.7% from August 1970 to August 2000.
3. The single worst 1 year rolling period for the TSX was June 1981 to June 1982 during which time the index lost a massive 39.2%.
4. The single best 1 year rolling period for the TSX was the very next year from June 1982 to June 1983 when the market returned 86.9%.
Cited from “RRSPs” Preet Banerjee 2007
On that note, have a look at the recent Wealthy Boomer article stating that Warren Buffett is a “huge bull on the U.S. economy’. A comforting article given all the recent short term volatility we have seen.
While a complete recovery may not be right around the corner (see yesterday's Globe & Mail article on Buffett ) numbers will tell you again and again that down markets usually last 5 times less than up markets.
My last article focused on the fact that it is better to do nothing with present in a down market. For people invested with a good timeframe that is the best strategy. However, for those looking to invest new money and take advantage of times like these the question is: when is it time to take advantage of a market downturn?
In the last year the highest month for mutual fund sales was in June and the lowest was last month. With the TSX being at it's peak in June this can be seen as a direct correlation to how investors are controlled by emotion in the markets. Last month alone RBC saw a net $1.9 billion assets move into money market to escape the risk of equities.
Being an advocate of long-term, conservative investing it can be obvious in hindsight how emotions can control market timing.
"Far more money has been lost by investors in preparing for corrections, or anticipating corrections, than has been lost in the corrections themselves." Peter Lynch, Worth (September 1995)
Also, being an advocate of the advantages of long-term leverage a correction or down market is the best time to maximize returns (especially given the numbers and long-term trends above). This is one of the topics that I will be discussing on the CFRA program on Saturday.
I will finish with a link to an amazing article from Larry Swedroe . Enjoy!
Experts on Call 580AM CFRA Ottawa Feb 09 4-5pm
I will be featured on Experts on Call this Saturday at 4pm. Topics discussed will be RRSPs, leverage concepts, and debt reduction. You can listen live by going to CFRA's website here.
Thursday, January 24, 2008
Market Commentary
In times of market volatility it is important to revisit the initial philosophy that brought you to choose to undertake any financial strategy: long-term, conservative thought. If there is anything that the last six years have taught is it is that the markets are a long-term vehicle that can treat us very well when given time.
Based on those comments I do not intend to undermine the volatility and the effects that it has had on portfolios around the world. Keep in mind, you are not alone. However, this is the time to take a step back from emotion and separate your true investor mentality from your fair weather mentality.
A financial advisor’s job is to pair you up with the best suited money manager as possible and design an efficient strategy around that based on your needs. In this respect,long-term, conservative mutual funds that are based upon a given strategy. In times like these it is important to realize that within the ashes of a volatile market these managers are given fantastic opportunity for growth potential.
A market recovery is not only the opportune time to invest, but also to strengthen an overall portfolio. History shows us that up markets often last 3-4 times as long as down markets. Not only that buy in the last 54 years, the market has risen in thirty-six years, been even in three years, and declined in only fifteen.
The key is: do nothing as markets test our emotions over this time of volatility. Prepare for a recovery and use that as a time to add to the markets.
It is times like these to not make knee jerk decisions. Quoting Jonathon Chevreau from the National Post ‘like being bogged down in traffic, there’s little that can be accomplished by moving to the left or right lane. Selling out of stocks now to go into cash would be like leaving the 401 for a country lane. Once the cars speed up again, you are stuck going 40 clicks on a country lane to nowhere.’
Based on the statistics in the previous paragraph the odds of being successful when you are in cash rather than stocks are almost three to one against you.
In summary, true investors look at times like these as opportunities rather than tragedies. Already as I write this the markets have recovered substantially from yesterday’s “plunge”. The key is to not let fear outweigh common sense and make mistakes that may be regretted down the road.
Keep in mind that an investor’s outlook should always be minimum five years. When using the best quality money managers in the world this should manage risk. Take advantage of opportunity when it applies. Priority one is always risk management.
One should only take money out of a down market or make changes for one of three reasons:
1) you absolutely cannot sleep at night
2) you absolutely need the money right away
3) your time horizon has changed to be much shorter.
Remember: it is always darkest before dawn.
Based on those comments I do not intend to undermine the volatility and the effects that it has had on portfolios around the world. Keep in mind, you are not alone. However, this is the time to take a step back from emotion and separate your true investor mentality from your fair weather mentality.
A financial advisor’s job is to pair you up with the best suited money manager as possible and design an efficient strategy around that based on your needs. In this respect,long-term, conservative mutual funds that are based upon a given strategy. In times like these it is important to realize that within the ashes of a volatile market these managers are given fantastic opportunity for growth potential.
A market recovery is not only the opportune time to invest, but also to strengthen an overall portfolio. History shows us that up markets often last 3-4 times as long as down markets. Not only that buy in the last 54 years, the market has risen in thirty-six years, been even in three years, and declined in only fifteen.
The key is: do nothing as markets test our emotions over this time of volatility. Prepare for a recovery and use that as a time to add to the markets.
It is times like these to not make knee jerk decisions. Quoting Jonathon Chevreau from the National Post ‘like being bogged down in traffic, there’s little that can be accomplished by moving to the left or right lane. Selling out of stocks now to go into cash would be like leaving the 401 for a country lane. Once the cars speed up again, you are stuck going 40 clicks on a country lane to nowhere.’
Based on the statistics in the previous paragraph the odds of being successful when you are in cash rather than stocks are almost three to one against you.
In summary, true investors look at times like these as opportunities rather than tragedies. Already as I write this the markets have recovered substantially from yesterday’s “plunge”. The key is to not let fear outweigh common sense and make mistakes that may be regretted down the road.
Keep in mind that an investor’s outlook should always be minimum five years. When using the best quality money managers in the world this should manage risk. Take advantage of opportunity when it applies. Priority one is always risk management.
One should only take money out of a down market or make changes for one of three reasons:
1) you absolutely cannot sleep at night
2) you absolutely need the money right away
3) your time horizon has changed to be much shorter.
Remember: it is always darkest before dawn.
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