Q – I’ve been told that I should review my investment portfolio around this time of year. But my I have a “balanced” portfolio with about 50% in fixed income and 50% in equities. A lot of it is in passive, index tracking ETFs, with some active mutual funds. Shouldn’t this type of portfolio pretty much take care of itself? – Allan P., London, Ontario
When it comes to family tax essentials you need to grasp in building wealth for your future, there is both good news and bad news in the new Family Tax Cut provisions recently announced by the federal government.
REITs had been on quite a tear until mid-2013 when Ben Bernanke’s infamous tapering talk sent bond yields soaring. With yields on the rise, the prices of income producing investments, including real estate stocks and REITs were sent lower. Many investors who held REITs, real estate ETFs, and mutual funds were a little taken aback by the big drops, and many sold out of the sector entirely. But most of the funds have since recovered their losses, with many posting impressive gains in the past year. The real estate equity category gained 16.4% in 12 months ending Oct. 31, the fourth-best showing of all categories in the period.
Saint Francis of Assisi once reminded his congregation to “preach the gospel at all times, and, when necessary, use words.” Apparently, the European Central Bank’s president, Mario Draghi, slept through that sermon. In what is now famously known as his “Do Whatever It Takes” speech in July 2012, Draghi used rhetoric rather than real policy action to resurrect markets.
The value and quality of the stocks you consider are far more important than what the share price happens to be doing at any given moment. Stocks go up and down every day. Sometimes there is an obvious cause in good or bad news. But there’s a large random element to stock price changes, particularly over short periods. Here are two of the most common investment errors: