Successful Investing Requires a Long-Term Approach
Investors are advised to take a long-term approach to investing writes Peter Watson. Patience, patience, patience. That is a key to successful investing. Over the years I have heard many stories of people making investment decisions that ended up to be very damaging to their investment returns. In hindsight, their decision to buy or sell […]
Residential Rentals Putting a Strain on Personal Finances
Increasing residential rental rates are getting too expensive for many Canadians, writes Peter Watson. The increasingly tight residential rental market could put a strain on individuals’ personal finance. When we think of real estate our focus tends to be on homeownership and escalating prices due to supply and demand realities. More people want to buy […]
Invest in Stocks – Prepare to Lose
There will be a time when you lose money. That is a certainty. The assumption is based on a broadly diversified portfolio versus owning just a few stocks. Information is taken from the S&P 500, a US stock index. Yes, some years you win when your stock portfolio increases in value. Winning is easy. Anyone […]
Failed CMHC Policy Could Not Control Rising House Prices
Canadian house prices continue to rise and are increasingly unaffordable, writes Peter Watson. Canada Mortgage and Housing Corp. failed at its attempt to slow the increase of house prices. This could affect homeowners and prospective homeowners. Last year CMHC increased the financial requirements to qualify for mortgage insurance. Mortgage insurance is required for buyers who […]
Is It Time to Re-Balance Your Investment Portfolio?
Re-balancing your investment portfolio is needed when stock and bond values fluctuate, writes Peter Watson. Do you own too much stock? Recently, because of the rising stock values as opposed to bond values, your asset allocation between stocks and bonds has likely shifted. Let’s look at a simple example. The starting point of developing a […]
Investment Predictions Often Do Not Come True
Using predictions to make investment decisions can lead to disappointing outcomes, writes Peter Watson. Making investment predictions can be dangerous. A rhetorical question. Looking back to last year in March, would an investor liked to have predicted the pandemic was coming? With the knowledge of a pending COVID-19 crises, most investors would have sold all […]
Languishing can be Damaging to Your Personal Finances
Languishing after COVID-19 could be harmful to earning an income. That can be detrimental to your ability to be financially self-sufficient, writes Peter Watson. Your financial success has a new potential obstacle to overcome. This obstacle was discussed in a New York Times article earlier this year on languishing. Early research suggests that languishing could […]
Stocks and Bonds: What to Expect
Let’s talk investments. Specifically, how the volatility of stocks and the returns of stocks are related. Many investors dislike volatility. A stock can be worth $10 a share, increase to $15, decreased to $8, and then back up to $11. Most would prefer a $10 a share price to increase gradually to $11. Perfect. A […]
Managing Your Investment Risk
Rebalancing your portfolio is an effective strategy, writes Peter Watson. The downside of investing is the underlying risk. We can all agree that strong returns are acceptable and welcomed. At the same time, losing money is difficult to tolerate. There is a well-known strategy that can assist. Rebalancing your portfolio. We will assume you have […]
Personal debt is a financial challenge
Household debt is the most significant financial risk for some families, writes Peter Watson. Managing personal debt could become the most important financial challenge for many households. Historically the two most significant financial objectives were preparing for retirement and saving enough money to help children with the cost of post-secondary education. These two priorities will […]