Financial Advice

[Copper1212]

I'll keep this short and sweet....I'm young, I have $16,000 (all matured) in Canada Savings Bonds. What should I do?

 

[syn]

Start RRSPs and invest.

 

[Copper1212]

So it wouldn't be wise to leave them as is and let them collect interest still? I gather that return on Canada Savings Bonds isn't what it used to be.

 

[androiduk]

No matter where you invest it, make sure you open up a 'Tax Free Savings Account" in January. Your annual limit is $5000 and everything you make inside the account is tax free. As far as investments go, I have been pouring every cent I can get my hands on into high yield U.S. dividend stocks. Check it out but only do it if you have a long term view. If you're interested, I'd be happy to give you some ticker symbols.

 

[Copper1212]

^ That would be great, thanks.

 

[afransen]

I would avoid trying to pick stocks. I don't think $16,000 is enough to have a reasonably diversified portfolio.

Look into index funds. I've been shopping around and I've decided to go with ING's Streetwise Growth fund. It's 25% Canadian equity, 25% US, 25% international, and 25% bond. If you want to avoid risk in terms of trying to time the market, you can periodically buy a fixed amount in $, leaving the rest is a high interest savings account (3% or so).

 

[Urban Shocker]

Buy art.

 

[androiduk]

Here you go Copper, the ticker symbols and their approximate annual dividend yields.

DSX 13%
ACAS 17%
FRP 14%
FTR 9%
BVF 13%

When investing in dividend stocks, the basic maxim is 'buy and never sell'. These are long range investments and the continual ups and downs of the share price are of no concern. Most of the growth in the stock market has historically come from dividends. The dividends are automatically deposited into your brokerage account every 3 months, you don't have to do anything. All info on the stocks listed can be gotten from www.nasdaq.com. If you re-invest all your dividends you can expect your $16,000 to turn into $1,000,000
in 20 to 30 years.

 

[Therion]

Most of the growth in the stock market has historically come from dividends. .

This is sadly true. If you take the 8% annual growth rate in the stock market and subtract inflation, you're not much ahead of the yearly dividend payouts of large companies. I trade quite a bit, but in the last few months the only stock I kept was a steady income fund that gives me 6% return.

Androiduk, what's the MER on these funds?

 

[androiduk]

These are not funds, they're individual stocks. I honestly can't see myself ever buying a fund.

 

[afransen]

You're exposing yourself to a substantial amount of risk, only being invested in a few stocks.

 

[androiduk]

You're exposing yourself to a substantial amount of risk, only being invested in a few stocks.

That was only a sampling of the stocks I own. It's up to the individual to do their own research. I generally don't put more than 10% of my money into any one stock.

 

[Chuck]

I would avoid trying to pick stocks. I don't think $16,000 is enough to have a reasonably diversified portfolio.

Look into index funds. I've been shopping around and I've decided to go with ING's Streetwise Growth fund. It's 25% Canadian equity, 25% US, 25% international, and 25% bond. If you want to avoid risk in terms of trying to time the market, you can periodically buy a fixed amount in $, leaving the rest is a high interest savings account (3% or so).

I don't like seeing bonds form part of a mutual fund. Why not buy the bond directly and avoid paying the MER?

 

[urbandreamer]

Some stocks (Oil and gas):

BQI

ARH.v

(pharma)

MDG.v

APH.v

.v means TSX venture exchange "penny" stocks.

All longterm holds (3-5 years)

(dividend paying)

FRO (watch for cheap entry @about $30 soon....)

 

[CGM]

Penny stocks are a gamble... I've got burned with those before... mind you, I've got burned with Nortel too
Heck, buy a few whores and 8-balls, go to Vegas and live like a rock star... you only live once