# Hey all



## muf4evr (Mar 30, 2010)

Hey all,

New to the forum looking for some financial advice.

A little bio for those who didn't read my bio/background:

25yr old; full time student; full time work at minimum wage; opened an rrsp wit manulife through my employer last june; found your forum and thought i could pick some brains for greater financial knowledge.

So I decided to look at my portfolio online the other day (I haven't bothered to look since I filled out the necessary forms at work last June) and saw that my returns from June to December was 10% and looking at some pie chart on the site realized that I am a balanced investor (whatever that means). Feeling the urge to scratch my inquisitiveness I decided to browse through the site (most of the data I saw looks more like cuneiform than english to me) and also searched the web on RRSP and how I should design my portfolio.

I happened to stumble upon a couple of articles which adviced that young savers like myself should design a less risk adverse portfolio since I'm a long way from retiring.

The question I have for you wise sages is considering I got a 10% (I'm not even sure if 10% is a good return or not) return on a balanced portfolio last year in just 6 months should I change my portfolio strategy from a blanced to a growth or high risk.

I'll appreciate any constructive response and all are welcome to make smart, crude, or whatever comments about Windsor or Detroit.

Thanks


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## andrewf (Mar 1, 2010)

Balanced generally means a roughly equal mix of bonds and equities. Given your age, and you are saving for retirement, I think it's fair to say you can go with the 'aggressive' strategy. I'd say that the 10% return you saw was not stellar, considering equities probably gained ~30% in that time. Your long-term performance will likely be less than 10% with a balanced portfolio.


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## HaroldCrump (Jun 10, 2009)

muf4evr,
Great that you are interested in finance at such an early age.
IMO, 10% return for 6 months is not bad at all, esp. these days.
I assume these are mutual funds that you have invested in.
Do not use this number as a benchmark for future returns.
There will be periods of time when your returns will be lower and times when it will be higher.
However, if you can maintain 10% annualized over a period of several years, you will do very well.
Use a returns calculator to figure out what 10% annualized can do after 20 years, 30 years and 40 years.

Also, be careful about the "aggressive" and "high growth" strategies recommended by many mutual fund websites.
High risk does not always return high growth.
High equity content does not guarantee high growth.
You have to understand what you are investing in, how it works, what the risks/downsides are, etc.

Next step for you is probably to understand how mutual funds work and how to select mutual funds better suited for your needs (look into low fee or index based funds).


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## heffer (Feb 21, 2010)

10% in half a year is really good I think. But keep in mind that June to December of 2009 was sort of an anomaly in the market where stocks did exceptionally well to recover from the huge drop during the previous years. 

I think being more aggressive with your portfolio will greatly benefit you in the long run. Just remember that your investments will become more volatile. Mutual funds are a great way to start, as well as index ETFs. If you are more adventurous you can start picking individual stocks. Usually companies in the oil/energy/real estate/financial sectors are good choices for beginner investers because they have a long track record of good risk/return ratios. (at least in Canada)

If you want some exposure to something more risky/aggressive you can try out things like the e-series mutual fund "TD Nasdaq Index" The MER is only 0.48% and you can put money in or take money out without paying trading commissions. Great for getting your feet wet in the technology sector. I'm not an expert on long term investing so you should read other people's replies and consult with your financial adviser/planner before deciding on anything.

I like using Globeinvester to do preliminary research on companies.
http://www.theglobeandmail.com/globe-investor/ 
You just punch in a quote and it gives you all the important information you need like dividend payout, eps, p/s, income statements, balance sheets, etc...


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