Investment companies in Vernon

[toughnut]

Captain We agree on that

[ScottSA]

Ask your parents, ask grandparents and neighbors who they invest with or do full financial planning.....referrals is the best way to find a financial planner, why would any one recommend someone that they aren't happy with?
Find out the following,: do they charge for an appt - the answer should be NO!!!!
: use your first instincts - rude, not paying attention, takes calls during appts
: look at the various regulating websites

That was some exellent advice April Lady. I agree that utilizing a referral is the best way to find a financial planner. My entire family (myself, my parents and my kids) work with Richard VanderBoom and his team at Investors Group here in town. I always send people to Richard if they are in need of a planner because being in finance myself I appreciate the importance of finding someone reputable and honest. Furthermore, working with his team means that you essentially have 3 consultants/planners working with you and for you. Each one of them has a valuable specialty and personality. He has a Partner, an associate and an assistant. He meets with me a minimum of three times a year to make sure my plan is still on the right track as life can change so suddenly. I can honestly say that his team cares. They send all of us a card on our birthday and our anniversary. He has client appreciation events that are a lot of fun. He's great for the whole community, always giving of his time and finances to worthy causes. He even sponsored my nefews baseball team! And he does NOT charge for his time. We don't pay him, Investors Group pays him. Having said all of that, that would be my recommendation!

Having spent seven years working as a Chartered Financial Analyst (CFA) for Investor's Group, I can tell you for a certainty that IG doesn't pay your adviser. You pay him, although it's done in such a way that you don't know it. When I worked there the methodology was through hidden fees taken off the top of your return (that's how most fund companies work, BTW). It's a good way to do it, I suppose, except that (at least when I was there in 1994 - 2001), they paid their sales agents higher commissions for equities, lesser commissions for debt/bond, and almost nothing for GICs. I expect it's still the same, although I'd have to check with my former colleagues. Guess where the lion's share of the money ends up?

The other problem is that (at least when I was there), there is no requirement for accreditation. Once licensed (a short, easy test), everyone becomes a "financial adviser." To become a CFA requires a great deal of time and effort. But don't kid yourself - the training is for planning only, and doesn't make anyone an expert on actual financial instruments. Everyone will talk about "10% over time," but if someone had put you in a basket of equities in 2000, you would have made about 0% between then and now, and if you panicked during the last market melt down you would have lost about 30% of what you originally put in.

I'm personally in favour of more active trading - especially in this market environment - but that carries risk too.

[Homeownertoo]

Scott, you were doing well till you got to equity performance since 2000. The TSE closed 1999 at 8,413. The TSX, it's closest equivalent today, is at 12,200, for a gain of 45%. That's not counting dividends, which I can only guess at, but 3% a year average should be close. Over 11 years, that would add another 38% return. Total gain within an RRSP, 83%. Not bad for the worst decade in this investor's memory.

Of course, that basket of equities you allude to would have set you up much better. Here's a representative 'basket' of well known Canadian stocks not only suitable for a fairly conservative investor but quite likely to have been chosen by such, and the percentage gain since Jan. 1, 2000, adjusted for splits where applicable.


BNS 364
BMO 237
RY 350
ABX 139
CNR 667
CTC.A 315
CPR 168
ENB 437
FFN 212
GWO 110

Total gain 300%

Those gains do not include dividends, which most if not all of these companies paid. $10,000 invested in these very common stocks at the start of 2000 would be worth well north of $30,000 today. Not bad for a lost decade. If you panicked in late September 2008 as the crisis was gathering steam, but regained your composure the following April, you would be looking at $50,000 by now, not including dividends.

[toughnut]

Scott, you were doing well till you got to equity performance since 2000. The TSE closed 1999 at 8,413. The TSX, it's closest equivalent today, is at 12,200, for a gain of 45%. That's not counting dividends, which I can only guess at, but 3% a year average should be close. Over 11 years, that would add another 38% return. Total gain within an RRSP, 83%. Not bad for the worst decade in this investor's memory.

Of course, that basket of equities you allude to would have set you up much better. Here's a representative 'basket' of well known Canadian stocks not only suitable for a fairly conservative investor but quite likely to have been chosen by such, and the percentage gain since Jan. 1, 2000, adjusted for splits where applicable.


BNS 364
BMO 237
RY 350
ABX 139
CNR 667
CTC.A 315
CPR 168
ENB 437
FFN 212
GWO 110

Total gain 300%

Those gains do not include dividends, which most if not all of these companies paid. $10,000 invested in these very common stocks at the start of 2000 would be worth well north of $30,000 today. Not bad for a lost decade. If you panicked in late September 2008 as the crisis was gathering steam, but regained your composure the following April, you would be looking at $50,000 by now, not including dividends.

that may be true in a perfect world with perfect hindsight but in almost everyones portfolio,s that started in 2000 or before there were too many "Enrons" and the lot that hurt a lot of people

[ScottSA]

Scott, you were doing well till you got to equity performance since 2000. The TSE closed 1999 at 8,413. The TSX, it's closest equivalent today, is at 12,200, for a gain of 45%. That's not counting dividends, which I can only guess at, but 3% a year average should be close. Over 11 years, that would add another 38% return. Total gain within an RRSP, 83%. Not bad for the worst decade in this investor's memory.

Of course, that basket of equities you allude to would have set you up much better. Here's a representative 'basket' of well known Canadian stocks not only suitable for a fairly conservative investor but quite likely to have been chosen by such, and the percentage gain since Jan. 1, 2000, adjusted for splits where applicable.


BNS 364
BMO 237
RY 350
ABX 139
CNR 667
CTC.A 315
CPR 168
ENB 437
FFN 212
GWO 110

Total gain 300%

Those gains do not include dividends, which most if not all of these companies paid. $10,000 invested in these very common stocks at the start of 2000 would be worth well north of $30,000 today. Not bad for a lost decade. If you panicked in late September 2008 as the crisis was gathering steam, but regained your composure the following April, you would be looking at $50,000 by now, not including dividends.

Well, I said 2000, not 1999. Just prior to the tech bubble fiasco, to be exact. The DOW closed the year (2000) around 11,500. Today it's at around 12,000, up from 11,500 a few days ago, and with the degree of volatility these days it'll no doubt be well below that sooner rather than later. That's 11 years with virtually 0 index return. Yes that doesn't account for splits, but it doesn't account for hundreds of billions lost in the tech bubble or in 2008 either. As for your basket of equities, 300% is nice, but we both know I can show you a basket of equities that had significant losses just as easily. In fact, if we both cherry-pick our baskets like you did, we can end up with outrageous returns balanced with 100% losses (I can pretty easily hunt around to find chapter 11s in the S&P 500, giving my basket of equities -100%). That means, of course, a total loss of every cent.

My advice for folks is that if you have less than $25,000 in long-term investment funds, put a bit away every month until you have $25,000. If you don't mind fluctuation in your funds, dollar cost average monthly or even weekly into an equity mutual fund of some kind, and if you don't like fluctuation, add monthly to a savings account. Whether those instruments should be registered (RSP) or not depends on a few things, and it'll probably help if you use an advisor (IG is as good as any), who will put together some kind of plan that'll set you on the right road. It's not so much a matter of "having money" as it is having money available for the right things, and having it invested accordingly.

Once you have $25,000 in long term funds, hire a pay-up-front advisor to manage your money for you. Unfortunately advisors working on commission have a number of inherent conflicts of interest, not least of which is the fact that they get paid higher commissions for some types of funds or, in the case of a broker establishment, higher commission by some fund companies (when I was there, Trimark, for example, allowed a broker to charge as much as 9%!). Advisors who get paid up front, no matter what your funds do, have no ax to grind in that department.

[Homeownertoo]

that may be true in a perfect world with perfect hindsight but in almost everyones portfolio,s that started in 2000 or before there were too many "Enrons" and the lot that hurt a lot of people

The question then becomes, why were you investing in Enron, a company with a corporate structure you assuredly did not understand, rather than these well known Canadian blue chips that are among the bedrock of conservative investors.

[Homeownertoo]

Well, I said 2000, not 1999. Just prior to the tech bubble fiasco, to be exact. The DOW closed the year (2000) around 11,500. Today it's at around 12,000, up from 11,500 a few days ago, and with the degree of volatility these days it'll no doubt be well below that sooner rather than later. That's 11 years with virtually 0 index return.

So you want to compare today's cautious market with a frothy market at its peak, distorted by a huge bubble in one sector, that a prudent investor could easily have avoided by choosing a "basket of equities" that is much more representative of blue-chip corporate Canada and much more conservative in valuation. Hardly a fair or realistic comparison.

I chose the start of 2000 for the very reason that it represented a market that was, like the current one, not distorted by an unsustainable bubble -- a much more reasonable comparison, I submit.

Yes that doesn't account for splits, but it doesn't account for hundreds of billions lost in the tech bubble or in 2008 either.

Why would a conservative investor, as almost all individual investors should be, have filled his "basket of equities" with massively overvalued tech stocks? But anyway, the TSX being an index, does take into account the tech bubble/crash.

As for your basket of equities, 300% is nice, but we both know I can show you a basket of equities that had significant losses just as easily. In fact, if we both cherry-pick our baskets like you did,

There was no cherry picking in my basket. I simply started at the top of the list of Top 100 on the TSE and chose large companies that would fit into a conservative Canadian investor's portfolio. Notice that the furthest into the alphabet I got was GWO, a large insurer that most certainly belongs on the list, as do the representative banks I included, and a smattering of industrial and energy stocks to give the basket some balance. And I picked them without reference to their stock performance, only determining that after the list was compiled. So no, this was not a list cherry-picked for its performance.

we can end up with outrageous returns balanced with 100% losses (I can pretty easily hunt around to find chapter 11s in the S&P 500, giving my basket of equities -100%). That means, of course, a total loss of every cent.

Except I didn't hunt around for winners. I took stocks that looked like solid conservative investments at the time without reference to their performance over the subsequent decade, which of course would have been unknowable for an investor in 2000.

My point, that someone investing conservatively at the start of 2000, not chasing a tech bubble or complicated corporate structures that promised the Moon, likely did very well over the past decade, contrary to your claim that is so often reflected in the media until it has become an urban legend.

[ScottSA]

that may be true in a perfect world with perfect hindsight but in almost everyones portfolio,s that started in 2000 or before there were too many "Enrons" and the lot that hurt a lot of people

The question then becomes, why were you investing in Enron, a company with a corporate structure you assuredly did not understand, rather than these well known Canadian blue chips that are among the bedrock of conservative investors.

Most people who invested with Enron either had no choice because they were investing through institutional investors who, according to you, should have known better, or because they worked for the company and didn't remove vested shares (assuming that the shares were actually vested).

Of course, with hindsight everything becomes much clearer. But would you have said the same thing about Lehman Brothers in 2006? CountryWide? AIG? US mortgage tranches? Sovereign debt instruments like Greece's and Italy's? Good Grief, the state of California is damned near broke! Surely you're not going to tell me you saw all of that coming? Very few of the fund managers - the ones whose entire educational and work experience involved studying financial instruments - saw it coming, so I'd be surprised if you claim to have seen it all coming. The truth is that for every stirling investment you come up with, there's a dog out there to match it. The same was true in the tech bubble, with Nortel, to mention only one, going broke and wiping out millions; true of Black Monday; true of the Wall Street Crash of 1929; and true of the South Sea Bubble 300 years ago. No one saw them coming until afterwards, and then of course everyone claims to have known it all along.

The fact is that most investors, whether they be trained or not, believe that when times are good, it means times will always be good, and that when times are bad, that they will always be bad. That's why everyone knows the mantra "buy low, sell high," and everyone says they believe it, but very few actually act on it. Most people do the opposite and panic when the market is low and buy when the market is high. Or, in the case of institutional investors, they're locked into asset allocation guidelines and have no choice but to balance portfolios as if the market were simply fluctuating and not heaving.

[ScottSA]

Well, I said 2000, not 1999. Just prior to the tech bubble fiasco, to be exact. The DOW closed the year (2000) around 11,500. Today it's at around 12,000, up from 11,500 a few days ago, and with the degree of volatility these days it'll no doubt be well below that sooner rather than later. That's 11 years with virtually 0 index return.

So you want to compare today's cautious market with a frothy market at its peak, distorted by a huge bubble in one sector, that a prudent investor could easily have avoided by choosing a "basket of equities" that is much more representative of blue-chip corporate Canada and much more conservative in valuation. Hardly a fair or realistic comparison.

I chose the start of 2000 for the very reason that it represented a market that was, like the current one, not distorted by an unsustainable bubble -- a much more reasonable comparison, I submit.

That's why I used the DOW instead of the Nasdaq. There was barely any distortion in the DOW. Along with the tech bubble on the Nas, there was a broad-based run up across the market in most sectors. Hence the massive difference between 1999 and 2000 on the DOW. The Nasdaq reflected the bubble, for obvious reasons, but the DOW not so much.

Besides, picking 1999 as broadly representative of the market is not really any better than picking any other time. Especially since two years later it was back where it started, and 6 years after that it was even lower. Picking 1999 is completely arbitrary. The only reason I picked 2000 is because that's what you challenged me on.

[Homeownertoo]

Most people who invested with Enron either had no choice because they were investing through institutional investors who, according to you, should have known better, or because they worked for the company and didn't remove vested shares (assuming that the shares were actually vested).

I thought we were talking about your average Canadian retail investor, not just Enron employees or people heavily invested in some American mutual fund or pension fund that, inexplicably, bet the farm on Enron.

Of course, with hindsight everything becomes much clearer. But would you have said the same thing about Lehman Brothers in 2006? CountryWide? AIG? US mortgage tranches? Sovereign debt instruments like Greece's and Italy's? Good Grief, the state of California is damned near broke! Surely you're not going to tell me you saw all of that coming?

I don't claim to have seen any of that coming. And that's the point!!!! I didn't have to. A Canadian retail investor with a representative basket of conservative large-cap Canadian stocks would have done very well over the decade beginning Jan. 1, 2000, despite all those market disasters. He would have done better without them. But a 300% gain, before dividends, over 12 years is more than adequate. And there was nothing contrived in that stock selection I made, as I pointed out earlier.

The truth is that for every stirling investment you come up with, there's a dog out there to match it.

Actually, since markets have trended upward almost (edit to add 'almost') every decade over the past century or so, that's not really true. But whose looking for sterling investments? Just a basket of conservative blue chips that are and continue to be well run and reward their owners with good dividends. They aren't hard to find, as I have demonstrated. I'm sure if you had been asked to pick a basket of stocks fitting that description from the TSE top 100 on that date, you 'd have done just as well, with no need of hindsight. And that is the advantage of the person who is willing to do his or her own investing, or rely on a knowledgeable advisor, over your vaunted fund managers, who face constraints that lead to underperformance.

The same was true in the tech bubble, with Nortel, to mention only one, going broke and wiping out millions; true of Black Monday; true of the Wall Street Crash of 1929; and true of the South Sea Bubble 300 years ago. No one saw them coming until afterwards, and then of course everyone claims to have known it all along.

Let's not get carried away. I wasn't around during the South Sea Bubble or 1929, so I can't claim intimate knowledge about what was or wasn't known in those days of something less than instant communication. But that's not the case with Nortel, which didn't collapse overnight from its stratospheric heights, and which, again, hardly "wiped out millions", unless you mean millions of dollars.

People who got wiped out did so because, in their greed, they forgot or ignored basic rules of investing. I feel sorry for them but hardly hold them up as examples of what the market delivers. It's not a game for fools, and such types should stay away from it. If they don't, well, too bad, so sad, but don't blame the market. It does reward people who use it to take part in the growth of well-run companies and have learned how to manage the risks it involves.

The fact is that most investors, whether they be trained or not, believe that when times are good, it means times will always be good, and that when times are bad, that they will always be bad. That's why everyone knows the mantra "buy low, sell high," and everyone says they believe it, but very few actually act on it. Most people do the opposite and panic when the market is low and buy when the market is high.

Very true, which is where, if you don't have the discipline and knowledge yourself, a good advisor earns his commission or fee. It's called educating the client (which really should be part of the due diligence requirement).

Or, in the case of institutional investors, they're locked into asset allocation guidelines and have no choice but to balance portfolios as if the market were simply fluctuating and not heaving.

Yes, this is an important point. I was largely out of mutuals by the late '90s for this reason, and learned in 2000 the full downside of this when my index fund got badly hit (thanks to Nortel) while most individual stocks rode it out with much less pain. The lesson I learned was to use index funds and ETFs with great care, or stay away from them altogether.

[Homeownertoo]

The only reason I picked 2000 is because that's what you challenged me on.

You named 2000 before I even became part of this discussion, not in response to some challenge from me. And my example also used the year 2000, the very first day of that year.

The only selection that was arbitrary was your decision to compare a market at the end of a run-up to its all-time high (to that date) with today's market, which is down (in Canada) about 30% from its all-time high. By contrast, I chose two market points that covered a very similar time period -- today and the start of 2000 -- but that were neither depressed nor unusually inflated, thus allowing us to compare market returns when the market is neither a bear, as it was in January 2009, or a raging bull, as it was at the top of the tech run.