How have you restructured your investments?

[Disgruntled70sHab]

badcompany said:

As an aside, I just won $10 in the lottery! YAY me! I only play like, once every 8 months (tax on the stupid they say, and sometimes I feel like being stupid - no comments please). What's Bre-X trading at these days? I got a good feeling about those guys...

You'd be better off with Enron.

[Yossarian]

I haven't done anything.

I lost enough in the 90's over the last Canada resource bubble, and then the dot.com bust earlier this decade, and restructured my investments significantly, so that they are more sensitive to my (true) investing timelines, and my investment tolerance (as far as my RRSP, I have no tolerance to risk, nor should anyone). I don't lose any sleep any more of adjustments such as the one we are going through, and which are inevitable, and sometimes necessary.

One thing about the Mutual Fund companies, their loyalty is to their shareholders, and not the fundholders. Most of the over 2000 Cdn. mutual funds don't come anywhere close to meeting the class benchmarks, and they charge way too much to manage the funds, as was mentioned previously in this thread. You really need to do your research to choose the right fund. Index funds are much better, lower cost alternatives.

Just as an aside, my father took out a life insurance policy in my name when I was a young boy in the early 70's, and I took over the premium payments when I started working. When many of the mutual Life Insurer's went public earlier this decade, they issued shares proportionally to all their "owners", which essentially meant the policyholders. So the longer you had a policy, the more shares you got. All the Cdn. Life Insurers are all well-managed, and have diversified nicely, and all issue generous quarterly dividends. The concept of getting a cheque every quarter was so nice, that I began investing in different Life insurer by buying more stock. It sure is nice to get a quarterly dividend cheque for doing nothing but holding stock, especially the original stock that was free, by basically holding a life insurance policy. All the stock has appreciated in value, even over the course of this current adjustment period. Dividend income from a Cdn. corp is also more tax favourable because of the dividend tax credit, so there is an even greater benefit. Investing in blue chip stocks, that pay regular dividends is a nice investing alternative for investments outside of an RRSP.

I am intrigued by the new $5000.00/year tax free savings account that the feds just introduced in the most recent budget. I think it has the capacity to be HUGE, and render RRSP's as a poor second choice for anyone with good savings discipline. I'll be watching as financial institutions release information about the products they develop for this. As far as I have heard, there are no restrictions on the type of investments one can use to earn the tax free returns within the account.

[Kareem]

Hey guys, it's been a while since I've posted here, but this is a topic I'm very much interested. I've been thinking of starting my Canadian investment website, since I find there's a lack of information.


First off, I suggest everyone to read The Intelligent Investor by Benjamin Graham. It'll be one of the best investments you can make and will have better, more detailed advice than any financial "advisor" could give you.


I also have to mention one thing: I'm a stranger, you wouldn't ask a total stranger for stock picking or investment advice, so do not take decisions based on what I write. I'm only offering information I feel is relevant.


One of the things that bother me personally is when an advisor makes claims such as whether a sector is "hot", or has "growth" potential. If he knew, he would be rich and not giving you advice from his CIBC/HSBC/TD 50k a year deskjob. Steer clear of speculation, high % kept for mutual funds and raise that red flag high when someone tells you they've THE stock to own. They didn't during the moronic internet bubble with 1000 P/E ratios, they don't now.

I believe stocks have been overvalued for years now, P/E ratios are higher than ever, people have access cheaply to these stocks more than ever and we're seeing titanic gains of 15-20% on the index average... The Dows average for the last 100 years is 5%! That's a similar return to bonds and while you can add the dividend payments most company's don't pay them anymore! Again, if someone guarantees you anything other than adequate returns, i.e. he says you will get 10% annually, flush him! He's suggesting the Dow gets to over 2 000 000 by the year 2100. Lets just say we have a long way to go and we're way behind in the last 8 years. We've set ourselves up for a second complete collapse of the market in only 10 years...


For a defensive, conservative investor, there are so many good choices. Always keep a good proportion of bonds and stocks (Between 25 and 75% for one or the other, never go lower or higher than those numbers). TD offers low cost index funds(under 1%), on a dollar cost-averaging program, you should get adequate results from the stock market. They also offer bonds in Canada/The US/Euronotes and completely safe Mortgage Backed Securities(they can replace a certain amount of bond percentage).

For example, you could go 30% bonds 20% MBS and 50% stocks. You would go for strickly high grade government bonds which you would keep to maturity. For stocks, you would try to diversify between the Canadian, American and different world markets. That way, you would benefit from the growth of not only the western economy, but the world economy. What better diversification?


Yossarian, I know what you're talking about by the way. We got the same benefits thanks to our life insurance policy with Sunlife.

Right now, I'm only a student, but I'm still debt free with a high amount of holdings I worked for which I think is well above average for my age and situation. I've added to my stock positions since I've found some good priced businesses that offered high dividend yield and who've had a history of earnings growth and positive net income. If I had to make my own speculative guess on the current market, I'd say I wouldn't get into an index fund without DCA, I'd rather go look for high quality companies that are victims of the markets excessive negativism.