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Special Commentary - New Format!

Posted on: February 11, 2019
Tags: 
investment
investments

I hope this update finds you well and spending your time on what brings you joy. Managing your money is not likely one of those things, and that's why am here for you. I love serving each one of you and am grateful for the trust you place in me.

I'm trying a new format this month. Your feedback is welcome. At the bottom of my commentary are two highly technical articles that some of you may enjoy. If you don't like details, ignore them! One is an overview of 2018 Market Statistics, and the other an article about tax on mutual funds titled "Understanding Distributions".

My thoughts:

  1. 2018 was a tough year for investors. Volatility returned and returns from most investments were negative. Though never fun, this is "normal" when investing in stocks, and necessary to achieve the long-term returns of stocks.
  2. Most of you have portfolios that did NOT decline the amount that the markets did. This is by design! We have carefully selected proven, professional money managers, most of whom actively manage your money through all types of markets. They have done a good job! Further, most of you own carefully constructed portfolios that blend different types of investments to both optimize your return for your risk tolerance and reduce volatility. It's working.
  3. Much of the short-term losses from Q4, 2018 have reversed in 2019. Expect that 2019 will bring continued volatility. 2018 was more "normal" than the very tranquil markets of 2017. Tune out the noise.
  4. It's tax time. Enjoy the tax slips coming your way! "Active" money managers often sell companies within your fund, at a profit, at some time during the year. CRA requires tax be paid on gains in the year the company was sold. "Passive" style money managers will sell companies less often, resulting in less taxable income today. The style of each investment team is different, and most of your portfolios incorporate different styles (by design). In the long-run and especially in our current market environment, I believe you will be rewarded by investing with active money managers. Tune out the tax.
  5. The RSP deadline is March 1, 2019. As well-planned clients, most of you are not affected. If you are thinking of topping up your RSP, let's talk ASAP.
  6. TFSAs. January brought an incremental $6,000 contribution room for most of you.
  7. New deposits to your RSP, TFSA, and other accounts can be done in person, or online through your bank. It's like a simple bill payment, but you pay yourself!
  8. What matters most – living your life, and the people and causes that are most important to you. A comprehensive financial plan ensures that your finances are organized and optimized for what matters most to you. I have completed a comprehensive plan for some of you and would love to do that for all of you. Your plan is truly unique, changes over time, and provides the backbone for making the best, informed financial decisions possible. It integrates all financial aspects including Tax, Retirement, Estate, Income, Investment Planning and Risk Management.


All the best.

Marlis

This article was prepared solely by Marlis Sawicki who is a registered Financial Advisor of FundEX Investments Inc. (a member of the Mutual Funds Dealers Association of Canada and the MFDA Investor Protection Corporation). The views and opinions, including any recommendations, expressed in this presentation are those of Marlis Sawicki only and they are not those of FundEX Investments Inc.

Discuss the risks associated with leveraged mutual fund purchased with an investment funds advisor before investing. Purchases are subject to suitability requirements. Using borrowed money to finance the purchase of securities involves greater risk than a purchase using cash resources only. If you borrow money to purchase securities, your responsibility to repay the loan and pay interest as required by its terms remains the same if the value of the securities purchased declines. Investors should educate themselves regarding securities, taxation or exchange control legislation, which may affect them personally. This presentation is for general information only and is not intended to provide specific personalized advice including, without limitation, investment, financial, legal, accounting or tax advice. Please consult an appropriate professional regarding your particular circumstances. Commissions, trailing commissions, management fees/expenses may be associated with mutual fund investments. Read the prospectus before investing.

Mutual funds are not covered by the Canada Deposit Insurance Corporation or any other government insurer, are not guaranteed and their values will fluctuate. Past performance may not be repeated. There is no assurance a fund will maintain its net asset value or that the amount invested will be returned to you.

Mutual Funds provided through FundEX Investments Inc.

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