TORONTO, Feb. 26 /CNW/ - It's natural to be concerned when markets
fluctuate more than normal, but well-diversified investments such as mutual
funds can go a long way to protecting you during turbulent periods.
"Mutual fund investors are usually in good shape during market
fluctuations because of diversification, the advantage of dollar cost
averaging and professional portfolio management," says Joanne De Laurentiis,
president and chief executive officer of The Investment Funds Institute of
Canada.Here are some helpful tips to keep you focused:
1. Focus on your objectives: Short-term market fluctuations should not
be a concern for investors with an appropriate time horizon and a
diversified portfolio matched to financial objectives.
2. Remember the benefits of diversification: A diversified portfolio
made up of equities, fixed income assets and interest-bearing
investments will cushion investors in a market correction. The
portfolio should be weighted to suit individual risk tolerance and
investment objectives.
3. Invest regularly: Maintaining the discipline of regular contributions
is important and awards you with the benefit of dollar-cost
averaging. This strategy allows a person to spread out the average
cost per unit of buying mutual funds, reducing the risk of buying at
the wrong time, and increases the number of units you buy.
4. Understand your risk tolerance: Once you have established your
tolerance for risk, you should periodically review your portfolio and
make sure your risk tolerance matches the types and asset mix of
investments your portfolio holds. If economic or personal
circumstances change, adjust your portfolio to your level of risk
tolerance. An investment advisor can help you.Contact a professional investment advisor to learn more about
diversification, risk tolerance and long-term financial planning.
For more information about the benefits of mutual funds, visit The
Investment Funds Institute of Canada's website at www.ific.ca.
For further information: The Investment Funds Institute of Canada, 11
King St. West, 4th Floor, Toronto, Ontario, M5H 4C7, TEL (416) 636-2158, FAX
(416) 861-9937, WEBSITE www.ific.ca
