One of the few perks of a Canadian winter is the image of snow falling serenely in a forest of evergreens... assuming you can see the image from inside your hot tub or out the window (!).. Regardless, that sort of scene has me thinking of the old trope, “Don’t miss the forest for the trees” in light of your financial strategy.
It's so easy, especially with all the COVID craziness, market worries and media screaming for attention, for people to lose track of the 'forest' and obsess over the nearest garishly colored 'tree'. It’s just human nature to focus on what’s in front of you.
This year is going to be different from the last two, even if it does have some of the same echo-feelings from last year. What I am seeing and hearing from the various economists, analysts and money managers we are in contact with is that there are two key differences from last year.
1. There is less general uncertainty about the world around the pandemic, simply because so much more is now known, because we have effective tools such as vaccines and treatments and workable policies for the governments to use. It's not perfect of course but its far more certain than the frantic scheming from a year ago.
2. However, because of that reduced uncertainty, there is potentially also going to be far more headwinds for investing this year. Things the managers are considering include such things as:
- the lack of stimulus cheques/free cash handouts
- the potential for rising inflation
- not as high as current levels but still settling higher than a year ago
- higher interest rates which will hurt both stocks and bonds in the short term
- continued supply restraints for durable goods
- a stock market sitting generally at much higher valuations
But to be clear, I am not giving you more 'trees' for you to worry about. I am letting you know that the professionals running your investments are already considering these things and are creating measured, reasoned responses depending on their discipline and strategy.
That leaves you and I to sit in the hot tub and stay focused on the big picture, YOUR big picture.
Together, we can take in the full view - and then make the best decisions for what you’re facing. So instead of focusing on each tree: each economic forecast – each screaming clickbait – each market fluctuation – focus on what matters: the complete picture and your long-term goals.
These articles I've attached can -if you are interested- get some more information and help you keep that perspective. Let me know if they inspire you or trigger questions of course. Take care!
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The comments contained herein are a general discussion of certain issues intended as general information only and should not be relied upon as tax or legal advice. Please obtain independent professional advice, in the context of your particular circumstances. This blog was written, designed and produced by Kevin Cork for the benefit of Kevin Cork who is a Financial Advisor at The Absolute Group a registered trade name with Investia Financial Services Inc., and does not necessarily reflect the opinion of Investia Financial Services Inc. The information contained in this article comes from sources we believe reliable, but we cannot guarantee its accuracy or reliability. The opinions expressed are based on an analysis and interpretation dating from the date of publication and are subject to change without notice. Furthermore, they do not constitute an offer or solicitation to buy or sell any securities. Mutual Funds, approved exempt market products and/or exchange traded funds are offered through Investia Financial Services Inc.
