Say I have $5000 that I can set aside to invest in something.
The goal is to maximize the growth at the end of 5 years. What should I do?
The goal is to maximize the growth at the end of 5 years. What should I do?
I'm totally new to investments, need advice!
- Thread starter Spacealien2
- Start date
Do a lot of reading before risking real money especially if you need it for something important. Learn how and why to invest and what causes industries, companies and the market to go up and down. Since you're a total novice, you may want to start with The Wealthy Barber books and Moolala by Bruce Sellery. Kevin O'Leary has a few books out there too, but I don't know how good or bad they are. There are also good web-sites like getsmartaboutmoney.ca, investopedia.com and fool.ca
Don't get caught up with the talking head on BNN, Financial Post, etc. who recommend specific companies because they are not looking after your money.
Don't get caught up with the talking head on BNN, Financial Post, etc. who recommend specific companies because they are not looking after your money.
Hello there,
I would agree with explorerzip that do your research first. I'd go beyond the titles listed (they are great choices though) and define if you are going to be a "trader" or "investor". If you don't think you have the time to develop your skills or put into trading you may want to look at a mutual fund or ETF and just manage the asset allocation.
All the best and good luck,
Goodguy
I would agree with explorerzip that do your research first. I'd go beyond the titles listed (they are great choices though) and define if you are going to be a "trader" or "investor". If you don't think you have the time to develop your skills or put into trading you may want to look at a mutual fund or ETF and just manage the asset allocation.
All the best and good luck,
Goodguy
Excellent point! A lot of people get these 2 mixed up. Nothing wrong with either "strategy", but they are totally different. IMO "traders" are looking for capital gains i.e. buying low and selling high and thus have to time their investments. "Investors" look for cash flow through dividends, interest, etc and buy and hold for a long period of time if not forever. So they are looking at the fundamentals of a business before they buy or sell.
Hello Spacealien 2,
Investing can be completely scary if you have little to no experience, or completely lovely if you are able to make educated choices. Would you be interested in hearing how you can make 15-20% return on your investment per year, for 2-3 years? If so, I am holding an info session where I encourage people to come and get EDUCATED. There is no pressure to buy on the spot. PM me for more details. Info session is the evening of Nov 23, 2015.
xoxo, Jada
First step is to open a TFSA account. Second step is to follow the advice given by OP's in prior posts AND open a direct investment account with whichever bank you like - this is where your TFSA will sit. Third step DO NOT engage a financial advisor. Finally, once you are informed invest in equities inside your TFSA and review your accounts at least weekly.
Go buy shake shack (NYSE:SHAK) in 5 years, this company will have a bigger valuation then it already does.
Fees are too high for mutual funds and a single stock is absolutely investing.
ETF funds like Vanguard are way better than mutual funds.
Lots of bad advice here. You should probably avoid equities if your time horizon is.less than ten years.
If you are new to investing, I would start here.
http://www.amazon.ca/The-Elements-Investing-Lessons-Investor/dp/1118484878
If you are new to investing, I would start here.
http://www.amazon.ca/The-Elements-Investing-Lessons-Investor/dp/1118484878
At 2.5% compound interest (GIC) about $657, at 10% about $3052. To double it you would need a 15% annual return (unrealistic without leverage). If your time horizon is less than 10 years and you buy equities, you are not investing, you are speculating. In fact you need 15 or more years to have a high probability of positive expected returns on equities.
Most people confuse investing with speculating - they are two very different things.
By the way, you can safely ignore 95+% of the advice you get here or anywhere else. Keep in mind Canadians pay the highest average mutual fund fees in the world at 2.53%
https://www.youtube.com/user/Thesensibleinvestor
No magic bullet to investing.. But extremely low rates globally and a domestic recession are adding to personal uncertainty.
Most important is developing a personal profile - horizon, risk tolerance, return goals
That will determine where to put the money towards.
Most important is developing a personal profile - horizon, risk tolerance, return goals
That will determine where to put the money towards.
I dont think that's how I would differentiate btw "trader" and "investor"....trader is basically all about market timing i.e. buy, short-sell and close your position very very soon most times within days if not hours....where as investor you tend to have alonger time horizon, you are looking at the fundamentals of the company and hoping it will go to its true value....yes lots of bad advice here
I LOVE this! The OP has asked for financial advice and people have given it freely (and sometimes quite poorly), yet YOU say do not engage a financial advisor. Why? Because they are expensive? Because they are in it for themselves? Because they don't add value? Hmm, having been a financial advisor for over 20 years, I know that my clients are better off, having listened to my advice. And yes, they are content paying the fees I charge.
Now, frankly, a $5000 account isn't worth my time, but that doesn't mean there isn't an advisor who is starting out that wouldn't love to sit down and help the OP. Recognizing that on an equity mutual fund, he'll make a whopping $50/year.
Or he can go it alone - judging by his initial question and obvious lack of experience and knowledge, I'm sure he'll do soooo much better than he would if he consulted someone who's livelihood is dependent on providing reasoned and suitable advice.
Timbit
I do find it ironic that the OP is looking for advice, gets it from so-called experts on here but then the absolute worst thing he can do is actually go to someone who does it for a living. Like any field, everyone is an expert in their own mind. But I've seen the work do-it-yourselfers have done in many areas: plumbing, car repair, taxes and yes financial advice and most times they do a poor job when compared to a professional.
"Don't hire a plumber! They overcharge! Fix that toilet yourself!". Sure. That'll end well.
