Latest articles

Index investing versus buying mutual funds

Guarding Wealth: To get diversification in your portfolio you have to pay for it, but not every mix works

There is an old saying that you can’t beat the market. Famed investor Warren Buffett has said, “Mr. Market always wins.” One school of investing agrees that, given you can’t beat the market, you might as well join it. That is the birth of index investing: the concept of buying index funds packed in exchange […] Read more

Stock market chart on LCD screen. Selective focus.

Global junk

Guarding Wealth: Scorned in the past, it’s become glamorous in a market driven by index funds

The investment market at times resembles a circus in which the strangest acts sell the most tickets. In the latest bit of acrobatics, sovereign junk bonds issued by national governments are turning in their best performance in years. For example, European sovereign junk returned 100 per cent in the nine years since the mid-2008 beginning […] Read more

Investing: taking risks in the new economy

Old economy, new economy. Finding safe off-farm investments in a perilous world

It is the question closest to the hearts and digestions of most investors: How long can the good times last? The tech-heavy NASDAQ Composite index was up 26.3 per cent for the 12-month period ending June 7, 2017. Canada’s S&P/TSX Composite Index rose a modest 7.7 per cent in the same period, restrained by flagging […] Read more

Guarding Wealth: Signs of future risk in the stock market

U.S. government initiatives are raising returns on government and corporate bonds

In the early days of the Clinton administration, Democratic Party strategist James Carville opined that, after death, “I’d like to come back as the bond market. That way, I could intimidate everybody.” Bond prices determine bond yields and yields determine the weight of public debt — how fast taxes can pay it down, how affordable […] Read more

Guarding Wealth: Keeping your financial portfolio stable

How much risk do you want in your portfolio, and will risk bring you higher returns?

Choosing stocks and bonds is in some ways like picking the petals off a daisy. The choice: will it be regular income or capital gains (hopefully)? Some investment assets pay regular income. In this category are conventional bonds that promise annual or semi-annual interest payments and dividend-paying stocks that make no firm promises but that […] Read more

Guarding Wealth: Long-term investing is a sure thing

There are short-term risks, but inflation and survivor bias make long-term bets winners

Let’s have a heart to heart talk about the fundamentals of investing on the farm and off the farm and, for that matter, investing in education for a career or a used car. Every investment has character, whether it’s a tech stock and you have to bet on a new trend or product on the […] Read more

Bubble in the finance world

Guarding Wealth: When will the stock market bubble pop?

Stock markets are soaring in spite of increasing risks. If this is a bubble, will it last?

When is a bubble a bubble? The Oxford English Dictionary defines a bubble as “a significant, usually rapid, increase in asset prices that is soon followed by a collapse in prices… typically arises from speculation or enthusiasm rather than intrinsic increases in value.” The question is vital right now, for one of the best guides […] Read more

Guarding Wealth: Farmers would be hostages in a trade war

Canadian farmers could suffer from American initiatives to shut borders to imports

Donald Trump’s elevation from businessman to American president could injure Canadian farmers gravely. Little is known of his plans, less of the laws he may try to push through the Congress and executive orders he may issue. But trade war is on the table and through no fault of their own, Canadian farmers may be […] Read more

Guarding Wealth: The alternative minimum tax

Passing on the farm can trigger an unpleasant surprise: 
an unexpected tax alternative minimum tax

The Alternative Minimum Tax is yet another wrinkle in preparing and paying income taxes. It’s particularly relevant to farmers going through succession planning where capital gains of six figures or more may be realized. The Alternative Minimum Tax (AMT) may apply to you even if you have not reached the limit of your Lifetime Capital […] Read more

Guarding Wealth: Changes ahead for 2017

Rising interest rates and the Trump Effect 
bring uncertainties in the New Year

If investing were easy, we’d all be rich. Today, capital markets have many new uncertainties. Top of the list: the Trump Effect. That is, what the new President may do after his inauguration on January 20. Also worrisome is where Europe is going if other members of the EU follow the United Kingdom out of […] Read more