Mutual Funds – Peterborough Financial Advice

Navigating through the world of mutual funds can be a tricky business to say the least and our Peterborough financial advisors know how to best navigate these waters. There are many Fund Companies all with many product offerings ranging from fixed income to equities and everything in between. The popularity of mutual funds has increased over the last couple of decades. Investors are becoming more educated with a higher risk tolerance.

As GIC rates drop, investors look to the market as a place to maximize returns. When selecting a mutual fund, advisors will recommend a fund managed by a fund manager with whom they are familiar and who has a great track record.

Two of the most important factors when investing are determining one’s risk tolerance and time horizon. Remember, the greater the percentage of equities, the higher the volatility (risk) and the greater the time horizon. Individuals that can’t stomach the ups and downs of the market or have a shorter time horizon should have portfolios with a higher concentration of fixed incomes (for example: bonds, GIC’s or money markets). In general, well-chosen equities (stocks) by the fund manager will outperform fixed incomes over the longer time horizon (10 plus years), but investors have to be willing to ride out the short term dips. Remember, the markets in the short term will always go up, and always go down – there are no exceptions. Investors who sell when the markets are down can seriously damage their portfolio and jeopardize their future income. Finding the proper balance is of utmost importance, especially if you want to enjoy a good night’s sleep. For a proper review and portfolio design, always ask a professional.

If you are unhappy with the performance of your current portfolio and seek a second opinion, please feel free to contact an IFG financial advisor in Peterborough today. You might be surprised at what other options are available for you.