November 16, 2009, 5:00 am

Festival of Stocks: My Thoughts on Investment Products

by: The Financial Blogger    Category: Reviews
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Welcome to this new edition of the Festival of Stocks! For this festival, I have decided to share my thoughts on a few investment products you may have or consider to include in your portfolio. If you are new to The Financial Blogger, I may suggest you read those investment related posts:

10 Trading Lessons for Free

Top 10 Dividend Stocks in Canada

9 Free Investing Resources

4 best stocks in 2009

#1 ETF’s (Exchange Traded Fund)

For someone who knows a little bit about stock markets and economy, building a portfolio with ETF’s may be the best solution. ETF’s can track anything you may think of (this is probably their biggest flaw at the same time!). So you can build a customized portfolio and fees are minimal. ETF’s are definitely the best products available on the market right now (again, for someone who knows what he is doing!).

The Smarter Wallet presents Should You Trade Stocks Online? posted at The Smarter Wallet.

Canadian Investor presents Should Penny Stocks Be In Your Investment Strategy? posted at Canadian Penny Stocks Blog.

Steve Alexander presents MFI Stock Review: Sturm Ruger & Co Inc. (RGR) posted at MagicDiligence – The Best Magic Formula Stocks.

AlexG presents Jim Rogers Financial Times Interview Novemver 03, 2009 | All Things Jim Rogers posted at All Things Jim Rogers.

#2 Mutual Funds

Several bloggers hate mutual funds or despise them. However, mutual funds can be very useful depending at what financial stage (and knowledge) you are. For example, for someone who is accumulating on a bi-weekly or monthly basis, investing periodically in a mutual funds will allow him to participate in the market with a small amount (things you couldn’t do if you would buy ETF’s). You also have managed solutions for clients who don’t want to take care of their investment but still want to invest. Overall, mutual funds are not as bad as they are described by a few financial journalists / bloggers.

Zach Scheidt presents Vitamin Shoppe Adds to Successful IPO posted at ZachStocks.

GLBL presents Get the Swine Flu H1N1 Stocks! posted at

Intelligent Speculator presents Will commodity ETF’s exist a year from now? posted at Intelligent Speculator.

D4L presents Johnson & Johnson (JNJ) Dividend Stock Analysis posted at Dividends Value.

Mike Piper presents Where to Rollover My 401k posted at The Oblivious Investor.

#3 CD’s (Certificate of Deposits)

In French, those are called CPG. It means Certificat de Placement Garanti. However, we call them Certificat of Pauvreté (poverty) Garanti (Guaranteed) in the banking industry. While this provide the ultimate security, rates are so low that you will barely protect your investment from inflation once you have calculated applicable taxes. In other words, I don’t really like them 😉

Matt_SF presents Traders Know it?s a Gold Bubble, Why Don?t You? posted at Steadfast Finances.

Jeff Rose presents What is a Penny Stock? posted at Jeff Rose.

Leslie Brown presents The Definitive Silver ETF Guide (Five Minute Edition) posted at ETF database.

Darwin presents 2009 Stock Market Returns YTD from Around the World – Shocking! posted at Darwin’s Finance.

#4 Dividend Stocks

I really like dividend paying stocks. Most of them are Blue Chips and offer a great stability in your portfolio while providing a constant income at the same time. The only thing to be careful with is to not consider dividend stocks like pure fixed income. As we have seen in 2008, even those shares can fluctuate a lot.

Mike presents Jumping On the Bandwagon posted at Minting Pennies – Personal Finance, Investing, and Microfinance.

Silicon Valley Blogger presents OptionsHouse Review: Low Commission Broker posted at The Digerati Life.

Super Saver presents A Bubble is Coming posted at My Wealth Builder.

#5 Bonds

If included in a bond ladder, municipal bonds and corporate bonds could be of great help in your investment portfolio. This will stabilize the volatility and can provide some good yield if you make your trades on the right timing (think about junk bonds in early 2009, this was the best performing asset class during the first 6 months!).

TIP Guy presents Stock Pre-Screening Process and Metrics | posted at presents Investing in Bonds posted at Trading Stocks.

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I’m a big fan of #4 and GICs/GIAs/guaranteed interest terms. I refuse to consider purchasing ETFs, and the mutual funds that I used to own within my RRSP have been sold and transferred into guaranteed vehicles. I would fall under the category of not liking mutual funds or ETFs because I have issues with fees and long-term performance.

Nice thread!

by: The Financial Blogger | November 18th, 2009 (9:02 am)

The Rat,
I don’t want to burst your bubble but I hope you are not expecting to get more than 4% yield for the next 5 yeas in your portfolio while the market is surging…

Even 4% is not acheivable right now. Best CD’s are around 3% – 3.5% for 5 years. That will barely cover inflation (considering it should be averaging 2% on the long run)…..

The market may be surging but there still remains a lot of uncertainty and volatility. Just take a look at gold prices right now as an example.

Don’t get me wrong, I’m a huge fan of dividend bearing investments, and strong Canadian equities comprise a significant size of my portfolio. Its in this area where I enjoy strong yields, many of which that offer greater than 4%, and expect long-term capital appreciation.

However, guaranteed vehicles such as GICs/GIAs are important for me as well. My guaranteed rates over the past several weeks have been between 3.5-3.8% on 5-year terms- and I’m perfectly fine with that given the % allocation in my portfolio.

I’m sure there are a lot of interesting mutual funds and ETFs out there that may suit your needs and provide a % of foreign content that you are comfortable with; however, I prefer to buy stocks outright and not have to rely on a collection of bonds or equities, etc. As I mentioned as well, I’m also not a big fan of fees either.


Excellent Festival Mike! Thanks for putting this together. Agreed — market is in uncertain territory right now. Who knows what the future will bring. Best to be diversified rather than to chase rates. Just my .02.

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