Stock Talk

Investing for Fun and Profit

A scary event occurred in the investing community recently. You might think it is the crash of the Nasdaq or the major decline of the Toronto Stock Exchange. Well yes that was scary, but even scarier was the virtual non event of the RRSP season.

It seems that Canadians equate RRSP contributions with investing in Nortel. Nothing could be farther from the truth. Contributing to your RRSP is tax smart, meaning the government will give you a deduction on your taxes. If you make a contribution you are ahead of the game. But you ask what is the point of putting money in the market if it just continues to go down, who cares what tax deduction I get if my principal declines. While the major indexes have shown weakness over the last three years some sectors have been quite resilient. With interest in the market low and stock prices weak the time to start investing is now. Over the next few weeks we will look at various strategies that can take seemingly mundane investments into a hobby that can be rewarding both spiritually and economically. A ten percent return may sound small by the late 90's standards but it is substantial. A ten percent return will double yor money every seven years and it is an achievable rate even in todays market conditions. Join us next week for a discussion on mutual funds versus stocks and which should you choose when you are creating your own portfolio.