2024 US Election and the Potential Impact on Our Portfolios
September 16, 2024
There is no doubt, however, that the current campaign is anxiety inducing for investors. Canada may be gearing up for its own divisive political battle, but its noisy neighbour is a behemoth that dominates news cycles. And just like a good horror film, these stories are full of jumps and nerve-shredding moments. It’s only human, therefore, to get caught up in these feelings.
No Champagne but a New Interest Rate Era has Begun
August 8, 2024
In the end, it was an anti-climax. After months of speculation and conjecture, the Bank of Canada has reduced its benchmark interest rate for the second successive time. But the markets, which had already priced the cuts in, gave an indifferent shrug.
I’ve heard more about inflation in the last year than in the previous 10. It’s affecting everyone's cashflows but what about investment portfolios? Let’s dig in and talk about what inflation is, how it’s calculated and how it impacts your investment portfolio.
Investors today are dealing with strong macro winds. It is not about the war in Ukraine, earthquakes or the divides in politics - those are all areas of concern to be addressed in other forums - it is about the persistent rise in interest rates. A wise and tenured investment manager was asked what his prediction was on rates and his response was that no one can really predict two things, inflation and interest rate direction. Recall the smart minds at the central banks calling “inflation transitory” not too long ago?
Investing money at its most basic is just delayed consumption. Putting $250 away versus buying another pair of shoes simply means you can buy those shoes at some point in the future. It makes sense then that the baseline goal of investing is to protect the purchasing power of your money. The good news is that by paying basic attention to asset allocation, tax rules, costs and generally not overmanaging, the goal of staying ahead of inflation is achievable!
Bull versus bear? Mutual fund versus ETF? How do they work out the inflation rate? How many times have your eyes skimmed cluelessly over an article or nodded in meetings at investment terms that are familiar but mean nothing to you?
Beyond Coldplay: how emerging markets enhance your investment palette
August 17, 2022
There’s a reason the likes of Coldplay and U2 sell millions of albums - people know what they’re getting. Whether it’s The Edge’s chiming guitar or Chris Martin’s lovelorn warbling, familiarity is comforting. Less widely known, and arguably more interesting bands, like Sparks for example, who switch up genres, often endure more sporadic profits.
Filling up your gas tank in recent months is like seeing the bill for your toddler’s birthday party – “how much?” For a smooth family life, however, both must be paid.
Managing money in a rising interest-rate environment
March 31, 2022
Canada’s benchmark interest rate hit an all-time high of 16% in 1991 – and here investors are in 2022, freaking out over projections it’ll touch 1% by June. But there’s a reason for the current unease. Despite rate increases being forecast the minute governments and central banks opened the floodgates on trillions of dollars of stimulus, things have now “got real”.
Between the pandemic, inflation, and geopolitical tensions, market uncertainty reigns right now. You might have heard some disturbing words, like shares “plunging”, prices “soaring”, and investment “volatility”. Many people, therefore, are asking themselves: should I take money out of the market and get back in when skies are clearer?
As Canadians locked their doors to avoid the freezing temperatures this winter, many settled back and watched the action unfold in China. But, at times, it was difficult to tell the bigger story. Was it which athletes made the podium, how many times Xi Jinping cozied up to Vladimir Putin, or was it the growing number of reports explaining the slowing Chinese economy?
