Trading in headlines not the best strategy. Informed advisers make a difference

November 7, 2017


Trading in headlines not the best strategy. Informed advisers make a difference


You don’t build a quality portfolio by chasing headlines, as one headline advised in a Globe & Mail article this month.

We commented in the article, which dealt with the NAFTA trade negotiations – and why it was too early for spooked investors to make a move one way or the other.

While our Chief Investment Officer Neville Joanes noted that an imbalanced trade deal would impact Canada and the USA, the challenge is that “no one knows yet what kinds of imbalances might materialize, or indeed, whether they will materialize at all.”

(Related: we talked about investing in the age of Trump around the start of these negotiations).

All the news that’s fit to print isn’t necessarily a good fit for smart investing

We’re only in the second act of the NAFTA drama, so it’s a good example of news with no clear implications. But for investors, incomplete or inaccurate reporting has the potential to do real harm (as opposed to just being annoying). This week, Facebook and Google were under the gun from investors over manipulations of their content distribution platforms.

Bloomberg News reports on how this can affect investors, particularly DIY-ers, with a good example of the iPhone 7.

Shortly after the September 2016 introduction, stories circulated that initial sales were disappointing, and you could sense that the Apple haters were intent on scoring points. As it turns out, that reporting was off the mark; sales of the iPhone7 turned out to be great and since then the company’s shares have gained more than 50 percent. The penalty for those inclined to believe this news was an expensive, missed investing opportunity.

And that’s why it helps to have an expert who can analyze how longer term trends (as opposed to today’s headlines) are affecting the market. To put it another way: it pays to be informed — and that’s one thing our financial advisors help do for you.

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