{"id":13360,"date":"2017-02-01T09:00:41","date_gmt":"2017-02-01T17:00:41","guid":{"rendered":"http:\/\/www.nexusnewspaper.com\/?p=13360"},"modified":"2017-01-30T11:09:29","modified_gmt":"2017-01-30T19:09:29","slug":"calculated-thought-investing-getting-started","status":"publish","type":"post","link":"https:\/\/www.nexusnewspaper.com\/newsite\/2017\/02\/01\/calculated-thought-investing-getting-started\/","title":{"rendered":"Calculated Thought<\/em>: Investing: getting started"},"content":{"rendered":"

Now that you know the difference between an RRSP and a TFSA (see last issue), how do you get started investing? Banks have discount brokerages\u2014services that process purchases and sales of investments\u2014that they work with. Do some research and find one that suits your needs.<\/p>\n

Once you have an account, you can start buying and selling securities. An important distinction is the difference between investing and speculating. Investing in companies or funds without research and analysis is basically gambling. Investing means taking a reduced, calculated risk, and knowing what you\u2019re buying.<\/p>\n

Rather than analyzing and investing in single companies, which takes a decent amount of financial prowess, mutual funds are a popular alternative. Fund managers pool investors\u2019 money together and invest in different security classes, sectors, and geographic areas, reducing risk through diversification.<\/p>\n

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Calculated Thought<\/em> is a column dealing with student finances that is featured in every issue of Nexus<\/em>.<\/figcaption><\/figure>\n

Buying a bunch of securities on your own\u2014with transaction fees, they\u2019re around $10 each\u2014can eat up returns on a small account. If you plan to make continuous, small contributions, mutual funds can be a cheaper way to do it. The downside is you pay a hefty management expense ratio (MER), from one to three percent. If the fund doesn\u2019t do well, losses to your account are magnified.<\/p>\n

Another option that provides diversification is buying exchange traded funds (ETFs). They are like mutual funds\u2014without the active management\u2014but can be bought and sold on an exchange. Some brokerages offer commission-free purchases of select ETFs, and the MER is up to 10 times lower. If you buy ETFs that aren\u2019t commission-free, transaction fees add up quickly, so some advisors recommend this approach for those with at least $50,000 to invest.<\/p>\n

There is much more to learn about how to actually build an investment portfolio. You should consider your goals and your tolerance for risk, and learn as much as you can.<\/p>\n

If you don\u2019t want to think too hard, you could take Warren Buffet\u2019s advice: \u201cJust buy an S&P index fund and sit for the next 50 years.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"

Now that you know the difference between an RRSP and a TFSA (see last issue), how do you get started investing? Banks have discount brokerages\u2014services that process purchases and sales of investments\u2014that they work with. Do some research and find one that suits your needs. Once you have an account, you can start buying and […]<\/p>\n","protected":false},"author":2,"featured_media":12581,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[5,181],"tags":[],"class_list":["post-13360","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-columns","category-february-1-2017"],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.nexusnewspaper.com\/newsite\/wp-json\/wp\/v2\/posts\/13360","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.nexusnewspaper.com\/newsite\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.nexusnewspaper.com\/newsite\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.nexusnewspaper.com\/newsite\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.nexusnewspaper.com\/newsite\/wp-json\/wp\/v2\/comments?post=13360"}],"version-history":[{"count":1,"href":"https:\/\/www.nexusnewspaper.com\/newsite\/wp-json\/wp\/v2\/posts\/13360\/revisions"}],"predecessor-version":[{"id":13361,"href":"https:\/\/www.nexusnewspaper.com\/newsite\/wp-json\/wp\/v2\/posts\/13360\/revisions\/13361"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.nexusnewspaper.com\/newsite\/wp-json\/wp\/v2\/media\/12581"}],"wp:attachment":[{"href":"https:\/\/www.nexusnewspaper.com\/newsite\/wp-json\/wp\/v2\/media?parent=13360"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.nexusnewspaper.com\/newsite\/wp-json\/wp\/v2\/categories?post=13360"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.nexusnewspaper.com\/newsite\/wp-json\/wp\/v2\/tags?post=13360"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}