Post-pandemic portfolio planning

Rebalancing for recovery

The March market meltdown, bond market gyrations, repricing of assets, and the flight to safety over the past couple of months has thrown many portfolios into disarray, particularly those of the do-it-yourself variety. The turmoil is likely to be reflected in increased values for fixed-income and cash holdings in your portfolio. Likewise, your equity values will have declined significantly.

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Dealing with market scares

Resist the urge to “do something”

Unless you’ve been away on vacation in a secluded place, you’ll know that stock markets sank alarmingly earlier this month as the U.S. Treasury bond yield curve “inverted” – that is, the yield on short-term bonds climbed above the yield on long-term bonds, albeit only very briefly. Fearing that an inverted yield curve signals a recession (as it often has historically), traders went into full-on panic mode, dumping stocks and moving to “safe haven” investments, like gold and, yes, bonds. The big North American stock market indices consequently lost ground, some sinking by triple-digit amounts in a span of two days. So is it really time to panic, sell all your stocks, and hunker down with your piles of cash? READ MORE

The role of a financial advisor

Differentiating from robots and algorithms

In this era of robo-advisors and artificial intelligence, it’s easy to believe that the expert, professional flesh-and-blood financial advisor has gone the way of the horse and buggy. It’s even easier to believe if you buy into the aggressive marketing by online portfolio management services that implies a human financial advisor basically sits back, collects fees, and buys a new luxury car every year. Of course, this grossly misrepresents what real advisors (as opposed to algorithms) actually do for their clients. So here’s a quick refresher on what to expect from a “real” financial advisor. READ MORE

Don’t panic! But do review your portfolio

Some annual housekeeping to keep allocations on track

Concerns about the health of the global economy, the effects of the U.S.-China trade and tariff dispute, rising interest rates, and the flattening yield curve combined to make the stock market slump of the fourth quarter one of the worst in a long time. Toronto’s benchmark S&P/TSX Composite Index dropped 11% in the quarter, as a 38% drop in the price of crude oil weighed on energy producers. The index ended the year with an annual loss of 11.6%. Similarly, New York’s blue-chip S&P 500 Composite Index plunged 14% in the fourth quarter for an overall 6.2% loss in the year. So is it time to sell stocks and re-set your portfolio with a heavier weighting to cash? READ MORE

The right financial advice doesn’t cost, it pays

Choosing the best financial advisory team

Once you’re established in your profession or career, and you’re accumulating a sizeable nest-egg, getting financial advice from your second cousin or the bank teller just won’t do. You need to get some professional money advice. But where to begin? There seem to be so many people offering advice, and you often read of people losing their investments through fraud or incompetence. Begin by asking yourself what you think you might need a financial advisor to do. Very likely, you’ll be running across some of these experts. Here’s a look at what they all do. READ MORE

How – and why – to review your portfolio

Avoid falling into the unintended investment-risk trap

Looking at your annual bottom-line performance is, of course, key. But it doesn’t tell the whole story. Conducting an annual investment review over and above the pure performance number tells you not only how your portfolio has performed – and whether it has outperformed your benchmark – but whether it’s time to make changes to your holdings. For example, some of your investments might have performed exceptionally well over the past year – U.S. equities, for example – and may have distorted your equity asset weighting well beyond your target level as a result. To properly review your portfolio, look first at four key areas. READ MORE

How busy Millennials can become investment couch potatoes

Active versus passive investment styles

The “couch potato” portfolio is so named because it takes a “passive” approach to investing. It is predicated on the theory that markets are efficient, or smarter, than any single person. Studies have shown that the passive, or couch potato, investment strategy on average beats about 80% of professional money managers over time. For time-squeezed Millennials who would rather do almost anything else than manage money, this strategy can make a lot of sense. READ MORE

Avoid these three wealth destroyers in 2017

Common investment errors can hit your portfolio hard

Investors who sold out of equities after Brexit and again just after the Trump election victory quite possibly lost money last year, even though the big stock market indices turned in strong gains. Turns out they fell into one of the most common investment pitfalls. Here’s a quick guide to three of the most common investing mistakes and what you can do to avoid them in 2017. READ MORE

Robyn Thompson interviewed on CTV’s Your Morning: the impact of the U.S. election for Canadian investors

Robyn Thompson is featured on CTV’s “Your Morning” show. She chats with host Anne-Marie Mediwake about the November U.S. presidential election, and whether Canadians should take this as an opportunity to reevaluate their portfolios.

Brexit? Trump? The Dow? Climbing the wall of worry

The market will fluctuate – get used to it!

Stock markets seem to be reaching record highs every day. Toronto’s S&P/TSX Composite Index is the top-performing market in the world so far this year. Yet endless storm clouds seem to be gathering permanently on the horizon: Brexit; the U.S. election; negative interest rates in many developed countries; and on and on. Should you pay attention? Yes, most definitely. But should you start selling off your assets looking for the (probably mythical) “safe haven”? No. Here’s why. READ MORE

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