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“You Have To Take The Emotion Out Of Investing” – Are You Considering Buying In?

Published

4 years ago

12 minute read

Are you? You may not be the only one. We have seen stock markets like the Toronto Stock Exchange take major hits over the past two months due to the effects of Covid-19 taking its toll on almost every industry. With some recent rises in markets continuing to build investor confidence, we are still left in the unknown for why this is happening. Living through a historically unprecedented time uncovers a long list of questions and concerns for our livelihood as individuals, quality of life for the future, and how best to navigate through this time. I’m sure during the Irish potato famine in 1845-1849, there were many people asking – what’s going on with all the potatoes? 

In a survey undertaken by the group “500 Startups” based in Silicon Valley, surveyed a group of investors to report on how they have been affected by the pandemic. The investor group consisted of venture capitalists, angel investors, corporate venture investors, and family office investors. The report showed 83% having their investment activity and plans be affected by Covid-19. As seen in the chart below, 62.6% of the group feel that startups and early-stage investors will be feeling the effects of the pandemic for 1-2 years. Their advice to startups during this time is to simply decrease costs and to increase their runway for how long they can stay in business. 

Data taken from 500 Startups report on The Impact of COVID-19 on the Early-Stage Investment Climate

 

We spoke with Kevin Skinner, an investment advisor for Servus Wealth Strategies, who gave us some insight and knowledge pertaining to open concerns for novice investors who may be seeking to enter the market or simply are in the dark for what to with their holdings. Kevin has been working in the financial services industry for over a decade and is a top investment advisor in their St. Abert branch. 

Considering what we have seen so far in stock markets, Is it a good time for new long term investors to buy now or continue to wait?

Striving away from the idea that fortune-tellers exist within trading, which is not true, a good education on markets is always a good pre-market investment of your own time. In regards to those looking to be a long term investor, he mentions:

“If you’re a long term investor the adage is that it’s always the best time…so question number one has to be, can you afford to invest the money right now…the second question is, what else can you do with this money. If you have $10,000 in the bank and $10,000 in credit card debt, always better to pay off the debt than you are investing that money.”

We want our money working for us right? Having a solid grasp of how your money is working for you may allow you to make a better-educated investment without adding any financial risk. The idea that there are smoke signals in the market to tell you it is the right time to invest, he mentions:

“If it was that easy, I would be sitting on my private island somewhere enjoying the world…It really is about investing correctly and investing to your plan. If your plan is to have the money for the long term, You need to have an understanding of your risks and your comfort.”

What if I have money to invest right now, should I wait for the bottom line? 

Kevin advised the dollar cost average tool to take the emotion out of investing. With so much volatility in the market, we revisit the concept that fortune-tellers exist to tell other investors when to buy; there is no way to fully identify the risks. To ensure you’re getting good value for your money, Kevin offers an example of the dollar cost average approach:

“Take your pool of money, call it $12,000. You invest $1,000 a month in a particular fund. You catch the market as it wobbles, so you don’t necessarily buy it all at the bottom, you’re definitely not buying it all at the top. You’re averaging your cost date and to get a good value for what you’re buying.”

Do you have an opinion on panic selling at a loss? 

Straight out of the gate, Kevin is a firm believer that anything that involves the word “panic” is never a good thing. Investopedia’s definition of panic selling refers to the sudden, wide-scale selling of a security or securities by a large number of investors, causing a sharp decline in price. We have seen this as a result of the COVID-19 pandemic. Panic selling can be directly related to having an emotional connection to your investment, but to ensure the doom and gloom doesn’t get the better of you, having an objective view allows you to stay logical and stick to your plan. Kevin mentions: 

“you have to do whatever you can to pull that emotion back out. Panic selling immediately is focused on the emotional side of it. You have to remove the emotion from investing.”

Not as easy as it sounds right? We are going through an emotionally ramped up time during this pandemic, not to mention dealing with all the other unknown realities of how our economy will bounce back or when the non-essential business will be reopened. Kevin recommends choosing places to move your investments to take the panic out. 

“You don’t call a realtor when your house is on fire. That’s where we’re at in the market right now, we know the house is on fire. We don’t know how long it’s going to last, how bad it’s going to be, or what it’s going to look like when it’s put out.”

 

Can you offer any comment on the fear of more lows, or what are the key indicators that we should be aware of?

We have seen stocks rise over the past week due to economic stimulus measures and the actions being taken to gradually reopen global economies. Experienced investors are forward-thinking individuals, they take into consideration the risk-reward for having objective optimism in certain industries. Kevin encourages to take the view that the rises we have seen are temporary for now, he mentions:

“Know that there’s another drop coming. Know that we don’t know how bad it’s going to be. And we don’t know how long the recovery is going to take. which is why we’re saying it’s going to be 2021 at least before the flooding of the market recovers”

We are expecting a long and slow road to recovery, but finding the bottom line can be almost impossible. Ask yourself, what happens to market optimism if a vaccine is made available tomorrow? Does that mean the market will become flooded with investors? It is impossible to know; by choosing a trusted investment advisor they can assist with taking the emotion out of your investments, and you can lean on their knowledge of markets to offer that objective optimism. For individual investors, it is useful to be aware of the activity in that sector to aid in growing your confidence, or the counter, it may give you key information to avoid a bad buy right now.

How have you been navigating through this time?

Kevin is one of many continuing to work from home during this period of self-isolation. With any new environment carries challenges. He is thankful for Servus Credit Union for the support he has received and the efforts put forward by the whole team. He has been spending some time in the welcomed sunshine playing sports with his 12-year-old son in his driveway.

What has Servus Credit Union been proactively doing to support its customers right now? 

Servus Credit Union released their response to COVID-19, issuing kind words to their members that they are here for them during this time. Their CEO, Garth Warner also released a personal letter to all of their members speaking on behalf of the team doing everything they can do to support their members. Kevin mentions:

“Our members are truly members, they’re all owners. Everyone who deals with the credit union holds a piece of the credit union. Right now we’re trying to keep our whole business, our owners, and our members afloat…so whatever we do, is what’s best for us as an organization which means it’s also what’s best for our members”

What are you personally looking forward to after this period of self-isolation?

“I coach sports. Of course every kid’s sport is canceled right now. We lost the end of our sports seasons for the winter, we’re going to miss the beginning of our sports season for the spring. And that’s what I miss most is getting outside with the kids and just having fun.”

If you would like to learn more about Servus Credit Union, Servus Wealth Strategies or Kevin Skinner, visit their website or social links below.

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Freedom Convoy

Trudeau’s use of Emergencies Act has cost taxpayers $73 million thus far

Published on April 17, 2024

By

From LifeSiteNews

By Clare Marie Merkowsky

Expenses for the Emergencies Act, the use of which a federal court ruled ‘not justified,’ included $17.5 million for a judicial inquiry, $400,000 for charter flights and $1.3 million for hotel rooms for out-of-town RCMP officers.

The Liberal government’s use of the Emergencies Act against the 2022 Freedom Convoy has cost Canadian taxpayers over $73 million thus far. 

According to newly released records obtained by Blacklock’s Reporter, Prime Minister Justin Trudeau’s enactment of the Emergencies Act, the use of which has since been ruled “not justified” by a federal court, to drive out Freedom Convoy protestors from Ottawa in 2022, cost the Department of Public Safety $73,550,568.  

According to Blacklock’s Reporter, the $73 million figure was part of records released by the department at the request of Conservative MP Ziad Aboultaif, and despite its high number, is not the final account.

“With regard to enactment of the Emergencies Act in 2022, what was the cost burden for the government?” Conservative MP Ziad Aboultaif asked.  

“Cost associated with fiscal year 2023-2024 are still to be determined,” the department responded.  

According to the Department of Public Safety, most of the public safety expenses were attributed to local authorities in Ottawa and Windsor, Ontario.  

“It should be noted additional funding allocated by the government to Ottawa and its partners as well as Windsor were not specifically as a result of the Emergencies Act invocation but meant to compensate both municipalities for the extraordinary expenses incurred during and after the protracted blockades,” the report said. 

Other expenses included $17.5 million for a judicial inquiry, $400,000 for charter flights, and $1.3 million for hotel rooms for out-of-town RCMP officers.  

The costs were incurred after Trudeau enacted the Act on February 14, 2022 to shut down the Freedom Convoy protest which took place in Ottawa.  

At the time, the use of the Act was justified by claims that the protest was “violent,” a claim that has still gone unsubstantiated.

In fact, videos of the protest against COVID regulations and vaccine mandates show Canadians from across the country gathering outside Parliament engaged in dancing, street hockey, and other family-friendly activities.

Indeed, the only acts of violence caught on video were carried out against the protesters after the Trudeau government directed police to end the protest. One such video showed an elderly women being trampled by a police horse.   

Recently, Federal Court Justice Richard Mosley ruled that Trudeau was “not justified” in invoking the Emergencies Act.

However, the Trudeau government has doubled down on its heavy-handed response to citizen protesters, filing an appeal with the Federal Court of Appeal – a court where 10 of the 15 sitting judges were appointed by Trudeau.

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Business

Red Deer District Chamber responds to Federal Budget

Published on April 17, 2024

By

From the Red Deer District Chamber of Commerce

The Red Deer and District Chamber has reviewed the federal budget and despite a few bright spots,
there are no efforts to boost productivity and innovation in the country which is sorely needed for
economic growth.

Scott Robinson CEO for the Red Deer District Chamber commented, “The budget’s tagline is “Fair-
ness for every generation”; however, it is unlikely that the spending will improve conditions and continuing to increase taxes and spending will simply add to the inflation and GDP stagnation that
we are facing, as public debt reaches record highs”

Highlights include:

• Carbon tax rebates are finally being introduced for small businesses (499 or fewer employees), with approximately 600,000 firms eligible for a share of $2.5 billion. Consumers began receiving these rebates over five years ago and now small businesses will finally see the return of some of the tax dollars collected through the carbon price’s fuel charge.

• A framework for open banking will allow consumers to easily access financial data across institutions, apps, and services. Specifics will be forthcoming before the end of 2024, but this could result in business opportunities and choices for consumers.

• The targeted 3.87 million net new homes by 2031 is a step toward combatting the housing crisis experienced in Red Deer and across the country. However, our city has yet to be successful in securing funding support through the Canada Mortgage and Housing Corporation’s (CHMC) Housing Accelerator Program, despite being the 56th most populated city in the country and a vacancy rate of 0.8 percent for 2023. We are hopeful to see additional federal investment in our city and have identified recommendations to all levels of government in the Chamber’s Homelessness Task Force Report.

Areas of particular concern:

• Increasing the capital gains tax through reducing exemptions is estimated by the federal government to bring in $20 billion in additional revenue over the next five years. The Red Deer Chamber of Commerce opposes increased taxation, especially when this represents an additional tax on already taxed income. This plan will likely result in decreased investment within the country.

• Deficits of $39.8 billion are projected for 2024-2025. The government also plans to spend $54.1 billion on debt servicing, with no plans at all to decrease total public debt. This amount equates to $2 billion more than is allocated to healthcare ($52.1 billion).

• $53 billion in new spending has been identified over the next five years. This continued spending and increasing debt will negatively impact investment and will continue to increase taxes for all.

“The federal government’s 2024 budget was an opportunity to enhance economic growth and set the country on a new path, toward prosperity and investment indicated Chamber CEO Scott Robinson. “In our view the initiatives suggested by the federal government will not benefit Red Deer and district, or indeed much of the country”. The Federal Budget presented by the Government yesterday just solidify how important it is for Chambers across Canada to advocate for economic growth, innovation, and productivity policies our country needs”.

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