Ottawa Investment Advisor John Bruce

Opportunity Strikes: Thoughts on 2009

June 1, 2009 · Print This Article

The year of 2008 was no doubt a trying time for anyone paying attention to market fluctuations. Since March 9, 2009, the Canadian market, as measured by the S&P/TSX has increased by approximately 20%. Whether this is the beginning of a bull market or a bear market rally remains to be seen. Regardless of what it is, please remember this: Even though this time is difficult, our plans were built to last through market corrections like this. Moreover, because we have a plan, situations like this are actually an excellent opportunity to build your resources for the future.

Let me explain: When markets are riding high, each dollar you invest buys fewer mutual fund units or company shares, because each unit costs more. When the market falls, it takes unit prices with it – the cumulative effect of this is unfortunate and it’s a shock for some, but markets do in fact recover, given enough time. The shares you are holding today, hopefully, will eventually recover some, if not all, of their value as markets recover.

In the meantime, shares are cheap, making this an excellent opportunity to buy and invest more for your future. Those of you who invest automatically every month are already taking advantage of this opportunity: Dollar cost averaging is a strategy that allows us to acquire more shares while prices are low. If you’d like to increase your contribution to your Group RRSP plan in order to enable you to buy more units, please fill out the attached form and return it to your Group plan administrator.

Whether you’d like to increase your contribution to your Group RRSP plan, take advantage of the new tax-free savings accounts to shelter your future gains or even use some leverage to invest (interest rates are low right now), the conditions today are good.

Of course, all of these options need to be considered within the context of your overall financial plan. Please call my office and set up an appointment if you have any questions or would like to review your current situation.

Best regards,

John S. Bruce
Investment Advisor
Mackie Research Capital
Direct Line- 613-425-3732
Toll Free- 866-860-4190

The opinions, estimates and projections contained herein are those of the author as of the date hereof and are subject to change without notice and may not reflect those of Mackie Research Capital Corporation (“MRCC”). The information and opinions contained herein have been compiled and derived from sources believed to be reliable, but no representation or warranty, expressed or implied, is made as to their accuracy or completeness. Neither the author nor MRCC accepts liability whatsoever for any loss arising from any use of this report or its contents. Information may be available to MRCC which is not reflected herein. This report is not to be construed as an offer to sell or a solicitation for an offer to buy any securities. Member-Canadian Investor Protection Fund / member-fonds canadien de protection des épargnants.

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