Articles & Insights
Financial Post  |  10 April 2015

Say bye-bye to yesterday’s bond nirvana and hello to tomorrow’s suffering

Ever since the U.S. Fed chairman Paul Volcker crushed runaway inflation in the early 1980s, conservative retirees with bond-laden portfolios have been in nirvana.

From 1982 to 2014, as inflation generally fell faster than interest rates, Canadian government bonds delivered a stupendous real (i.e., after inflation) return of 6.5% per annum – nearly three times greater than the 2.2% average since 1900. A real annual return in the magnitude of 6% to 7% is typically only available from growth-oriented investments such as equities. Read more >

Financial Post: Personal Finance  |  09 August 2014

The wrong guideposts for retirement planning

No one wants to outlive their money. No wonder many retirees fixate on how much income their portfolios will generate. They often assume that if they can just produce enough income to live on without touching the principal, their financial future will be “golden.” Nothing could be further from the truth.  Read more >

Financial Post  |  11 February 2014

Beware of “chasing false returns”

Mutual fund marketers must be licking their chops in anticipation of attracting assets in 2014. Boosted by the tailwind of a falling Canadian dollar, the S&P 500 delivered a stunning 41.3% return in 2013, the most impressive annual performance in over half a century.  Read more >

Financial Post: Managing Wealth  |  11 December 2013

Underfunded retirement? Go cold turkey on spending.

The average life expectancy of a 60-year-old is approaching 90 but the bad news is that many affluent Canadians can’t really afford to live longer. According to a study by McKinsey & Company, 41% of older, high income Canadians are not on track to maintain their standard of living in retirement. Read more >

Financial Post: Managing wealth  |  27 November 2013

The one easy rule you need to know for picking a winning index fund

Imagine that you have decided to invest in a stock mutual fund. Given the tear the American market has been on lately, you decide to invest in a fund that exclusively buys U.S. stocks. Also, because you’ve heard some good things about index funds, you decide to buy a fund that tracks the investment results of the S&P 500 index and owns 500 leading, large companies in the U.S. Fortunately, you have some choice because more than one investment company offers this type of index fund.

So looking at the chart below, which fund would you pick? Read more >

Financial Post: Personal Finance  |  12 November 2013

Can a computer generated portfolio deliver better returns?

In a host of endeavours, quantitative models are surpassing human experts in decision accuracy. Software programs that predict the location and frequency of criminal activity have repeatedly beaten the forecasts of experienced police analysts. Models that assess credit worthiness have proved so superior to human judgment that they are now used across the credit card and mortgage industries.  Read more >

Financial Post: Managing Wealth  |  26 October 2013

Leaving an inheritance to the kids

After a lifetime of hard work and saving, you have accumulated serious assets. When you die, do you really want your diligence to fund a life of leisure for your kids? Or do you worry that your children lack the know-how to manage significant amounts of capital, and that a sea of red ink will swamp your financial legacy? Read more >

Financial Post: Investing  |  11 October 2013

Active fund managers take another beating

Advocates of active investment management over passive index investing must be cringing at the latest results of the S&P Dow Jones Indices vs. Active Funds (SPIVA) Canada Scorecard. Read more >

Financial Post: Managing Wealth  |  30 July 2013

Why there’s no such thing as a safe haven

Investors who flocked to “safe haven” assets over the past several years suffered a rude shock in 2013. Government bonds, the security blanket of choice for investors traumatized by the global credit crisis, lost 2.2% in the first half of this year. Yet, this disappointing performance looks absolutely scintillating compared to gold bullion. Read more >

Financial Post: Managing Wealth  |  26 June 2013

Number of world’s millionaires up by 50% since 2008

Despite an insipid economic backdrop, global private financial wealth growth accelerated markedly in 2012. According to the recently released Global Wealth 2013 report by the Boston Consulting Group (BCG), private financial assets worldwide reached $135.5-trillion in 2012 – a 7.8% increase from the prior year and a marked recovery from the tepid 3.6% growth in 2011. Read more > 

Financial Post: Managing Wealth  |  23 May 2013

Comeback in international equities shows forecasting just a ‘guessing game’

If you ask the average investor which stock market has been the top dog of late, the answer would likely be the U.S. After all, the financial media has been ablaze with the news of the Dow Jones and S&P 500 indices hitting record highs. Yet, over the past year, U.S. stocks actually have come in second regionally. Read more >

Financial Post: TFSA  |  13 May 2013

Fragmented investment management can add to tax bite

Most high net worth investors are only too happy to bid adieu to tax time each year. Assembling all of the investment income slips and back-up required by their accountant can be a real chore. Adding to the ordeal is the fact that many affluent investors work with more than one investment firm. Read more > 

Financial Post: Managing Wealth  |  16 April 2013

How to avoid the dreaded return gap

Virtually every study of investor behaviour has found that the average investor’s returns from their fund investments lag the returns earned by the funds themselves. This return gap has usually been attributed to ill-timed buying and selling as investors chase returns, particularly those of hot managers. New research in the U.S. released by Morningstar Inc. confirms that this return gap continues unabated.   Read more >

Financial Post: Managing Wealth  |  19 March 2013

High MERs may be the least of your problems

When Harry Markowitz, an aspiring graduate student, had his article entitled Portfolio Selection published in the Journal of Finance in 1952, he could not have foreseen that his insight into diversification would earn him the Nobel Prize. Read more >

Financial Post: Managing Wealth  |  06 February 2013

The affluent investor’s harsh RRSP reality

When affluent investors make their RRSP contributions, three financial events occur simultaneously. First, they are adding to their retirement investment capital. Second, they are creating a deduction that will reduce the tax they would otherwise be required to pay. So far so good! Read more > 

Financial Post: Managing Wealth  |  02 February 2013

Investors behaving like “generals who are always prepared to fight the last war”

Investors disappointed by the performance of stocks since the start of the new millennium have found solace in the 6.7% annual return of Canadian investment grade bonds. Bond investors enjoyed an annual real (i.e. net of inflation) return of 4.6%, a hefty premium to historic norms. Now, with the stock market perking up, many investors are looking forward to more favourable returns adding a little more gust to their sails in the years ahead. Read more >

Financial Post: Managing Wealth  |  18 January 2013

Why savvy, wealthy investors ignore market forecasts

Every year at this time a bevy of market gurus trot out their forecasts for the coming year. My favourites are the stock return predictions which, year in and year out, tend to be in the 5%-to-10% range. This seems to make sense — since 1926, large-company stocks in the United States have earned an average annual return of 9.8%. No wonder most market calls end up within striking distance of this average. Read more >

Financial Post: Managing Wealth  |  28 November 2012

Wealthy investors go global

What do Canada’s largest pension plans, major U.S. endowments and wealthy families have in common? They have taken their portfolios global by allocating an increasing share of their equities to foreign versus domestic stocks. Read more >

Financial Post: Managing Wealth  |  20 November 2012

How to protect your portfolio…from yourself

It’s easy to blow a hole in a portfolio. Just dump your stocks and head for the hills at the bottom of a nasty bear market. Then wait anxiously on the sidelines only to venture back in once prices have rallied. Or feverishly chase the latest hot manager until both your ardour and capital are swept away when the red ink starts. Read more > 

Financial Post: Managing Wealth  |  19 November 2012

What we can learn from the wealthy

It’s demanding enough to manage several million dollars properly but when the wealth climbs into the hundreds of millions or even billions, the challenges and complexity skyrocket. In recognition of this, many ultra-wealthy families set up what is called a single family office (SFO) to manage their financial affairs. Read more >

Financial Post: Managing Wealth  |  13 November 2012

Why wealthy investors are cutting back their bond holdings

Month after month, investors have been dumping their equity funds and loading up on bond and balanced funds. Who can blame them? Since late 2007, stocks have given them the rollercoaster ride of a lifetime, at the end of which the S&P/TSX Composite and S&P 500 produced average annual returns of -0.3% and 1.4% respectively. Read more >

Financial Post: Managing Wealth  |  16 October 2012

Ultra-wealthy look to Ivy League endowment funds for investment lessons

Today’s paltry interest rates on top of a decade of mediocre stock returns have prompted many wealthy families to search for more rewarding portfolio solutions. Some are turning to the trail blazing example of leading U.S. college endowment funds such as Yale’s and Harvard’s, which have been leaders in the quest for higher returning portfolios.
Read more >

Financial Post: Managing Wealth  |  10 October 2012

Peeling back the curtains on private money managers

There is a mystique that surrounds the investment affairs of the wealthy.

Instead of pedestrian mutual funds, they can access discretionary private money managers with hefty million or multi-million-dollar minimum account requirements. Unlike the fund world where performance is mercilessly on display day in and day out, the track records of private money managers are often shrouded in secrecy. Read more >

Financial Post: Managing Wealth  |  15 September 2012

The odyssey of retirement planning

Retirement! For many, the very word conjures up images of freedom — an escape from the demands and drudgery of work; a chance to travel and pursue much neglected avocations; and the time to really enjoy the company of family and friends.
Retirement is supposed to be an exciting new stage of adventure and self-determination. Unfortunately, the reality is both different and much more complex. Read more >

Financial Post: Managing Wealth  |  08 August 2012

Toting up the score; indexing vs. active investing

Keeping score is how winners are separated from losers. So it’s not surprising that a decade ago, analysts at Standard & Poor’s decided to do just that by pitting the performance of S&P indexes such as the S&P 500 against the returns of actively managed mutual funds.
To keep the scorecard honest, their work incorporated three key features missing in many studies. Read more > 

Financial Post: Managing Wealth  |  14 July 2012

Intuition won’t help you make money

Have you ever been on the receiving end of an investment pitch? More often than not, the sales story is proclaimed in glowing terms such as – this is a “world class” manager who has consistently achieved “best in class” performance. The piece de resistance is typically a table comparing the recommended manager’s top drawer returns over the past three or five years to that of his or her peers. Read more >

Financial Post: Managing Wealth  |  24 June 2012

How to create a wealth transfer plan

A mindfulness of mortality is sweeping through Baby Boomers as their parents age and pass away. Heretofore so adept at turning back the clock … isn’t 60 the new 40?
But Baby Boomers are waking up to the fact that some passages just can’t be postponed. This newfound awareness combined with their own children reaching adulthood has focused many wealthy Boomers on the need to overhaul their own wealth transfer plans. Read more >

Financial Post: Managing Wealth  |  20 June 2012

Markets: Don’t get emotional

With the developed world mired in slow growth and the eurozone teetering on the brink of disintegration, to many investors the future seems bleak. Some are so disheartened they are abandoning the stock market as a hopeless endeavour. Yet, one of the abiding tenets of investing is that investor sentiment is rarely predictive of the future. Read more >

Financial Post: Managing Wealth  |  07 June 2012

The journey to inconceivable yields

The yields of government bonds of “safe” countries have plumbed new lows as investors engaged in another round of panicky bond buying. News that depositors are fleeing not only Greek but now Spanish banks alarmed the market. However, it was signs of a broadening economic slowdown in the U.S. and China that really triggered a flight to quality. Read more >

Financial Post: Managing Wealth  |  29 May 2012

The lopsided bet

Are you a betting person? Well, if you are, I have a wager about skillfulness that you might consider. First, let me lay out the odds. Your chance of winning this bet is only about one in seven — clearly a long shot. In this wager you stand to lose about 86% of the time. Read more >

Financial Post: Managing Wealth  |  12 May 2012

Danger lurks in a yield-starved world

The marketing antennae of the investment industry are finely tuned to the buying impulses of the investing public.
In the late 1990s, growth was the buzzword — you couldn’t read the financial media without being hyped on technology and Internet stocks and funds. In today’s yield-starved world, the sales focus is on high income or enhanced yield strategies. Read more >

Financial Post: Managing Wealth  |  28 April 2012

It pays to know your investment costs

There is one subject that the Canadian investment industry avoids like the plague — the costs associated with investing. This topic is particularly touchy because Canada is such an expensive country for investors. A 2011 Morningstar study compared the total expense ratios of money-market, fixed-income and equity funds in 22 countries and found that Canada had the dubious distinction of having the highest overall expense ratios. Read more >

Financial Post: Managing Wealth  |  23 April 2012

Focus on pre-tax returns results in costly tax bills

A cardinal error is committed with appalling frequency in managing the investments of affluent families — thinking in pre-tax instead of after-tax returns. This may seem surprising as taxes are often the biggest single expense of wealthy families. Similarly, affluent retirees live on after-tax, not pre-tax cash flows. Read more > 

Financial Post: Managing Wealth  |  31 March 2012

A tough time to retire

Imminent retirement often evokes a feeling of joyful anticipation as liberation from the daily grind beckons. However, for Baby Boomers hoping to retire in relative comfort, the prospect of no more paycheques provokes apprehension instead of delight.The massive market meltdowns of 2008-2009 and 2000-2002 have permanently scarred investor psyches. Read more > 

Financial Post: Managing Wealth  |  17 March 2012

9 ways to turbocharge your returns

Stock returns over the past five years have been downright dismal. In fact, many investors knocking on our door these days have earned virtually nothing since 2007 once you deduct management fees. And with interest rates now so low, unless we enter into a Japanese-style deflationary lost decade, the best days of bonds are behind us. So here are nine tactics that you can consider to improve your long-term performance in the years ahead. Read more >

Financial Post: Managing Wealth  |  03 March 2012

Portfolio diversity still your best bet

Imagine it’s January 2022 and you’ve just cracked open your latest investment statements. Are you smiling as you scan the numbers or are you cringing in despair? Of course, no one can predict with absolute certainty what returns will be over the next 10 years. However, several recent long-term forecasts by leading money managers and finance academics shed some light on what the future might hold. Read more > 

Financial Post: Managing Wealth  |  13 February 2012

Giving your inheritance now

Do you make an RRSP contribution or a TFSA contribution? Which is better? Every year a host of articles assist investors with this issue.
High income earners are fortunate – they don’t have to make a choice. They contribute to both their RRSPs and TFSAs to the maximum extent possible. And they do so as soon as possible every year to maximize tax-deferred and tax-free growth. Read more >

Financial Post: Managing Wealth  |  21 January 2012

Ignore those fallible forecasts

Every New Year brings a bountiful supply of economic and market forecasts by investment pundits. Well-researched, analytic and often insightful, the typical forecast, whether it is bullish, neutral or bearish, is artfully constructed. In search of guidance, many investors (and advisors for that matter) seize upon a specific strategist’s prognosis as a rationale for their investment decisions. This raises the question: Just how accurate are the forecasts of experts? Read more >

Financial Post: Managing Wealth  |  07 January 2012

The five biggest pitfalls to staying rich

When it comes to wealthy families, the expression “easy come, easy go” is more aptly rephrased “arduously earned, easily extinguished.” Serious wealth typically arises from decades of hard work, investment and calculated risk-taking. Yet, hard-won wealth easily dissipates if it is not managed properly. Read more >

Financial Post: Managing Wealth  |  24 December 2011

A gift from risky markets

This holiday season, gloomy economic prospects and mercurial markets are actually bringing investors a gift in the form of increasingly attractive stock valuations. Unfortunately, cheaper stocks, like fruitcake, are the kind of present rarely appreciated by the recipient. Weary of the never-ending barrage of melancholic financial news, most investors miss the opportunity wrapped in lower prices — higher potential long-term returns. Read more >

Financial Post: Managing Wealth  |  10 December 2011

Five things Wall Street doesn’t want you to know

Despite the blitz of flashy ads and seductive sales pitches this festive season, wise shoppers know that retailers have one paramount objective — to ring the cash register. Savvy consumers do their research, comparison shop, keep their impulses under control and hunt for the best value. Unfortunately, when it comes to Wall Street, many investors are bedazzled by the majestic pronouncements of market gurus and the illusionary reliability of short-term return numbers, and forget that Wall Street shares the same objective as Main Street — move the merchandise! Read more >

Financial Post: Managing Wealth  |  26 November 2011

Learning from investment leaders

Affluent investors can learn a lot from top endowments and pension plans. Take the Yale and Harvard university endowments, for example. Within the institutional world, they are renowned as astute, long-term investment strategists. Their results speak volumes — their annual returns of 10.1% and 9.4%, respectively, over the decade ended June 30, 2011 far outstripped the 4.3% return of the traditional pension mix of 60% stocks and 40% bonds. Read more >

Financial Post: Managing Wealth  |  16 November 2011

Financial security elusive in retirement

Retiring today with financial security is challenging. Courtesy of central banks, interest rates are at levels not seen since World War II. Then, ultra-low interest rate policies abetted wartime funding needs.
Today, central banks are promising a lengthy period of miniscule rates in a frantic effort to stave off the slumps and deflation that often follow on the heels of a credit crisis. Read more >

Financial Post: Managing Wealth  |  29 October 2011

Surprise! The world is getting richer

You wouldn’t know it from the endless torrent of gloomy news but the world is getting a lot richer. In fact, according to the Credit Suisse 2011 Global Wealth Report, total household wealth in the world has reached an all-time high of US$231-trillion. This enormous sum, which encompasses real assets including homes as well as financial assets, and is net of debts, is equivalent to $51,000 of wealth for every adult in the world. Read more > 

Financial Post: Managing Wealth  |  15 October 2011

Put some distance between you and your investments

Many investors’ account statements are now awash in a sea of red ink as a global bear market has mauled stocks. Some investors are fleeing equities; those who are staying put may feel like someone in stalled car on a railway track with the sound of a train whistle drawing closer. Read more >

Financial Post: Managing Wealth  |  17 September 2011

Protect portfolio from pickpockets

Bear markets savage most portfolios. In severe recessions, stock prices can plunge by more than 50%. Yet, it is not bear markets that cause the most damage to portfolios. Historically, stock markets have always recovered as business cycles swing from contraction to expansion. In fact, there have been 13 punishing bear markets since 1929. On average, stock prices doubled five years after their end. Read more > 

Financial Post: Managing Wealth  |  03 September 2011

Investors finally get a break

What is the single best predictor of a fund manager’s ability to outperform his or her peers? Sorry, it isn’t prior returns – we all wish it were that easy. Nor is it risk or the turnover in the fund. The unsurpassed predictor of a manager’s relative performance is his or her fund’s expense ratio. Read more > 

Financial Post: Managing Wealth  |  20 August 2011

Don’t leap from the frying pan into the fire

The fear in early August was almost palpable as stock markets plunged. The spectre of financial contagion from Europe, the downgrade of U.S. long-term debt and ever-worsening economic news was just too much for many investors. Anxiety that had never fully dissipated since the 2008/09 market crash reasserted itself with a vengeance, triggering a rush for the exits by many. Read more > 

Financial Post: Managing Wealth  |  06 August 2011

Invest in statistics, not stories

A growth stock is always accompanied by a seductive storyline. Today, social-networking stocks exude the allure that they are poised to capitalize on a revolution in shared digital communication. Internet World Stats estimates that there are now over two billion Internet users globally, up 480% over the past decade. With this fertile, expanding market, spectacular growth seems assured. Read more > 

Financial Post: Managing Wealth  |  09 July 2011

For rich even 70% might not be enough

A well-known financial planning rule of thumb asserts that individuals need about 70% of their employment income to retire comfortably. Affluent investors can toss that guideline into the wastebasket. Given that wealthy retiring couples tend to have distinctive goals, retirement costs among the affluent can vary markedly. In fact, one U.S. study of affluent retirees found that nearly 20% of the respondents spent more in retirement than when they were working. Read more >

Financial Post: Managing Wealth  |  25 June 2011

The rich also lack financial discipline

It’s hard to stay on course. Millions of people start diets every year but don’t maintain their resolve. Home fitness equipment often gathers dust in a lonely corner of a basement. Self-discipline is also a challenge in personal finances and, based on a recent global survey of 2,000 high net worth individuals by Barclay’s Wealth, many affluent investors struggle with this problem. Read more >

Financial Post: Managing Wealth  |  23 June 2011

There is a pattern to all this drama

It takes a brave soul to read a newspaper today with a steady hand. The world seems to lurch from crisis to crisis. One day it’s the possibility of a financial contagion sweeping through Europe. The next, it’s the spectacle of political gridlock in the United States that could lead to a debt default. Story after story recounts languishing growth in most of the developed world along with sputtering employment gains. Read more > 

Financial Post: Managing Wealth  |  11 June 2011

Separating skill from luck isn’t easy

If your investment manager beat the market over the past three years, you may want this question answered before congratulations are in order: Was this outperformance due to serendipity or skill? Unfortunately, the answer is that it is virtually impossible to tell. Read more > 

Financial Post: Managing Wealth  |  28 May 2011

Lies, damned lies and returns

The saying popularized by Mark Twain, “lies, damned lies and statistics,” might spring to mind when investors grapple with the reams of return numbers spewed out by funds, managers and the financial press. It’s easy to understand why investors can be confused. Read more >

Financial Post: Managing Wealth  |  14 May 2011

Peeling back the covers on Canada’s ultra-wealthy

It turns out there are a ton of millionaires in Canada. According to a recent study on global wealth by the Deloitte Center for Financial Services, there are 1,745,000 households in Canada who can boast a net worth of $1-million or more, about one out every seven households. Thank soaring house prices for a good chunk of this wealth. Read more >

Financial Post: Managing Wealth  |  30 April 2011

Time to go global

It is a heady time for Canadian investors. Our banks avoided the meltdowns experienced by many financial institutions in the global credit crisis. Demand for our commodities is skyrocketing. Canadian federal government bonds are rated a rock solid AAA. The loonie, once mocked as the northern peso, is riding high. Read more > 

Financial Post: Managing Wealth  |  16 April 2011

Wealthy need to watch spending

There’s an old financial planning adage that states “your rate of saving is just as important as your rate of return.” Savings, particularly in the early years of wealth building, creates the seed capital that unleashes the magic of compounding. Today, with the Baby Boomers heading into retirement, a more apt adage is “your rate of spending is just as important as your rate of return.” Read more >

Financial Post: Managing Wealth  |  30 March 2011

Natural catastrophes are inevitable, so are market meltdowns

The tragic effects of the earthquake and tsunami in Japan have highlighted the calamitous consequences of major natural disasters. Fortunately, such catastrophes are rare. When they occur, many people are shocked. Read more >

Financial Post: Managing Wealth  |  19 March 2011

111 years of lessons

Investment plans require a long-term focus – one that considers decades of possible Investment performance, not just next month’s or next year’s. A sound plan also incorporates the important lessons of the past and avoids excessive bets based on the prognostications of the latest hot guru. Read more >  

Financial Post: Managing Wealth  |  05 March 2011

Retirement’s so yesterday

Many affluent people are tossing the conventional notion of retirement into the dustbin. Instead of dreaming of decades of leisure, the majority of the respondents in a recent global survey of wealthy individuals by Barclays Wealth want to keep on working. They envision themselves as Nevertirees rather than retirees. Read more > 

Financial Post: Managing Wealth  |  19 February 2011

The power of deferral

Wealthy people have a peculiar problem. Yes, they pay a boatload of taxes, but that alone is not the issue. Much of the income of many high net worth investors is taxed at the highest marginal rate. With top marginal rates approaching 50% on interest and other income for most Canadians, this tax bite seriously erodes investment returns. Take a bond yielding 4%, for example. At a 50% tax rate, the after-tax return is only 2%. Read more >

Financial Post: Managing Wealth  |  05 February 2011

Chasing past fund returns a mug’s game

They’re back! After fading from sight for several years, those tantalizing fund ads trumpeting rocketing returns are in the media again. It’s no wonder. Last year, a number of mutual funds that focus on Canadian small-company stocks sported returns in the 40%-to-50% range. Some hedge funds did even better — several more than doubled in value. Read more >

Financial Post: Managing Wealth  |  22 January 2011

Prepare for the dark side of RRSPs

For the affluent, an RRSP is a vital vehicle in their retirement plan. It creates a tax-deferred environment in which high income earners, particularly well-compensated professionals and successful business owners, can build wealth over their working lives. This is critical since the returns from their non-registered investments, heaped on top of their incomes, are more often than not taxed at the highest marginal rate, which approaches 50% on interest and other income in many provinces. Read more > 

Financial Post: Managing Wealth  |  08 January 2011

Think before firing that fund manager

You’re fired! As investors react to their 2010 returns, many underperforming managers will be on the receiving end of these harsh words. U.S. mutual fund data indicate more managers are finding their heads on the chopping block these days. The average tenure of a fund manager in an investor’s portfolio was 2.9 years in 2008, down from 4.4 years in 2005. Read more >

Financial Post: Managing Wealth  |  26 December 2010

A wealth action plan for 2010

At the end of a busy year, many affluent individuals vow to get on top of their financial affairs. Sadly, they are often no more successful than they are at keeping their New Year’s resolutions. Like those extra pounds that survive annual January commitments to diet and exercise, a muddle of financial issues and administrative loose ends can easily endure year after year. Read more > 

Financial Post: Managing Wealth  |  18 December 2010

Put indexing in your stocking

This year when you line up to return pricey, outmoded gifts, you might consider doing the same with many of your mutual funds. That’s what serious investors should do based on sweeping new research on Canadian mutual fund performance released by The Vanguard Group Inc. Read more > 

Financial Post: Managing Wealth  |  11 December 2010

Warning: Asset bubbles are underway

“Bubble, bubble, inflate and trouble.” Macbeth’s witches would surely be chanting this incantation at the spectre of the frantic efforts of central bankers to re-inflate the economies of the developed world. Both the Federal Reserve and the European Central Bank have stepped up their quantitative easing, essentially printing money by buying government bonds. Read more >

Financial Post: Managing Wealth  |  27 November 2010

Canada’s aging millionaires

Canada’s millionaires are turning from baby boomers to greying boomers. Based on research by Investor Economics, over 40% of Canada’s millionaires — those in households with financial assets in excess of $1,000,000 — are aged 65 years and older. Comprising nearly a quarter of a million households, this has been the fastest growing segment of the high net worth market, having climbed over 20% in the past five years. Read more >

Financial Post: Managing Wealth  |  11 November 2010

Managing the family fortune

Family offices are a unique and growing option for affluent Canadians who are concerned with family wealth preservation and want a coordinated approach to their finances.
In its most general sense, a family office is an entity that solely manages and administers wealth for families of exceptional affluence. Read more > 

Financial Post: Managing Wealth  |  23 October 2010

Time to get real returns

If you were planning to fund your retirement on bonds and GICs, today’s low yields should be sending a chill through your plan.
Interest rates in developed countries have plummeted as the global recovery and employment growth has slowed. Long-term Government of Canada bond yields are languishing at levels not seen since the 1950s. Read more >

Financial Post: Managing Wealth  |  09 October 2010

Needless cost of mental games

You and your spouse are standing in line for a play and, to your dismay, you find that you’ve lost the expensive tickets you’d purchased for $300. Do you buy replacement tickets or do you head home in a funk? Read more > 

Financial Post: Managing Wealth  |  25 September 2010

Are your executors ready for your exit

Imagine that you are the victim of a freak accident. While golfing, you are struck by lightning and make an unexpected but dazzling departure from this mortal coil.
Your family is devastated. You are gone and everything you had handled falls on them. And now the litmus test: Is your financial house in order? Or are you leaving your family with a mess? Read more > 

Financial Post: Managing Wealth  |  04 September 2010

The global students

Buenos Aires, Shanghai, Prague, Rome, London. The academic programs abroad for children of affluence read like a retiree’s dream list for globetrotting.
By the time these teenagers graduate from high school, many of them will have spent several summers abroad earning course credits while being enriched by their exposure to new cultures, languages and people. Read more > 

Financial Post: Managing Wealth  |  14 August 2010

Success is in the mix

You should think of your portfolio strategy as a blender that mixes investments to your own unique taste. The asset classes of cash, bonds and equities are the basic ingredients. What you are really blending, however, is the distinctive return and risk profiles of these assets and how they interrelate to each other. Read more >

Financial Post: Managing Wealth  |  31 July 2010

How to avoid costly mistakes of being human

Try your hand at this quiz: “John wears glasses and is highly detailed-oriented. Mathematics was his favourite subject in school. He is somewhat conservative, maybe even a little boring, and prefers an organized work environment. He played basketball in high school and still loves to watch the game today.” Read more > 

Financial Post: Managing Wealth  |  17 July 2010

Rich are rising out of the ashes wiser

Thomas Edison famously stated: “A failure teaches you that something can’t be done — that way.”
Affluent investors, still reeling from the losses of the Great Meltdown, are identifying where their financial advisors failed them and are demanding improvements. Read more > 

Financial Post: Managing Wealth  |  03 July 2010

Legacy stash easily blown

An ancient Chinese proverb claims that “wealth does not pass three generations.” Most cultures have similar sayings about the limited life of family wealth. The American “shirtsleeves to shirtsleeves in three generations” is thought to have evolved from the old Lancashire proverb “there’s nobbut three generations atween a clog and clog.” The Italian saying “from stables to stars to stables” grasps the transitory nature of family wealth in particularly vivid terms. Read more > 

Financial Post: Managing Wealth  |  19 June 2010

While bulls and bears clash, the wise win

There is a great debate going on among money managers that has enormous ramifications for affluent investors.
On one side, the bears argue that the bill for a three-decade orgy of borrowing in Western society has now come due. That the massive monetary and fiscal stimulus by governments only postponed the day of reckoning and that the deflationary forces of deleveraging will eventually overwhelm the current recovery. Read more >

Financial Post: Managing Wealth  |  05 June 2010

Wealthy investors still recovering from the fight

Battered, worried and cautious. That seems to be the mindset of wealthy investors these days, based on the results of a recent global survey of 2,000 high-net-worth investors by Barclay’s Wealth.
Indeed, respondents were generally gloomier than professional economists. Only about one in five of the high-net-worth individuals expected any sustained growth in the world economy over the next few years, while nearly 30% expect deterioration. Read more >

Financial Post: Managing Wealth  |  22 May 2010

Volatility risk vs. longevity risk

It’s a scary world. The threat of a bond default by Greece, a tiny country with an economy smaller than Ontario’s, has sent tremors through the world’s stock markets. With other Mediterranean countries sliding towards the fiscal abyss, fear has become contagious. Investors worry that even the trillion-euro loan package won’t salvage the situation. Then, in the midst of this global drama, the Dow Jones plunges nearly 1,000 points, an intraday record. Read more > 

Financial Post: Managing Wealth  |  09 May 2010

Investors destined to repeat mistakes

If the definition of insanity is doing the same thing over and over again and expecting a different result, many investors seem to be a touch mad.
As the inevitable bull and bear market cycles occur, many investors routinely “buy high and sell low,” yet wonder why their portfolio performance is poor. Read more > 

Financial Post: Managing Wealth  |  24 April 2010

Where Paris’s parents may have gone wrong

Several generations ago, the prevailing belief was “spare the rod and spoil the child.” Today, a more apt adage is “spare the budget and spoil the child.”
At least that sums up the advice some experts have given affluent parents who are troubled about the negative impact wealth can have on their children. Read more > 

Financial Post: Managing Wealth  |  10 April 2010

A new kind of money coach

I was chatting recently with a successful entrepreneur about his approach to investing. “You know what I hate the most?” he asked. “Every month or so, I sit down on a weekend and go through the reams of statements I receive from my various money managers and brokers. If I don’t do it, I feel like I’m negligent, but when I do it, I’m not sure what I should be looking for.” Read more >

Financial Post: Managing Wealth  |  27 March 2010

Lessons from the big guys

What do the world’s largest sovereign fund and the largest U.S. pension fund have in common? Sure, they both manage hundreds of billions of dollars. And yes, they both enjoy access to some of the world’s smartest investment minds. Read more >

Financial Post: Managing Wealth  |  13 March 2010

Nothing succeeds like a succession plan

When it comes to wealth planning, many high-net-worth individuals seem to share the cockeyed optimism of Stephen Wright, who famously said: “I intend to live forever. So far, so good.” Read more >

Financial Post: Managing Wealth  |  27 February 2010

Watch out for that tax tail

There is an old saying that you should not let the tax tail wag the investment dog. However, without proper planning, high net worth investors – whose wealth extends well beyond traditional RRSP’s – may find that the bite of taxes can leave them with Chihuahua-sized after-tax returns. Read more > 

Financial Post: Managing Wealth  |  13 February 2010

Lost Decade wasn’t so bad for serious investors

It’s being called the Lost Decade — a dismal 10-year stretch from 2000 to 2009, when the average owner of U.S. stocks lost money. If US$1,000 was invested in the S&P 500 on the first day of the new millennium, it was worth only US$909 on Dec. 31, 2009, equating to a loss of -1.0% a year. Read more > 

Financial Post: Managing Wealth  |  26 January 2010

Money can’t buy happiness. Really.

Money can’t buy you love, but it also doesn’t buy much happiness. At least, that is what psychologists studying the causes of happiness have found. Money is important for meeting basic needs such as food and a roof over one’s head, but once these needs are satisfied, more money doesn’t necessarily lead to higher levels of happiness.
Read more > 

Financial Post: Managing Wealth  |  26 December 2009

A wealth action plan for 2010

At the end of a busy year, many affluent individuals vow to get on top of their financial affairs. Sadly, they are often no more successful than they are at keeping their New Year’s resolutions. Like those extra pounds that survive annual January commitments to diet and exercise, a muddle of financial issues and administrative loose ends can easily endure year after year. Read more >

Financial Post: Managing Wealth  |  12 December 2009

Keeping the wealth all in the family

Some people win the “gene lottery” and inherit their wealth. A handful of mega-earners such as top athletes and entertainers save their way to wealth. The source of most family wealth, however, is a successful business. The concentrated ownership of risky business assets is usually the route to serious money; diversification comes later. Read more >

Financial Post: Managing Wealth  |  28 November 2009

The wise rich know about risk

You can’t manage what you can’t measure. Thoughtful wealthy investors have learned this adage applies to managing investment capital as much as it applies to running a business. If meaningful benchmarks and other investment measures aren’t defined at the outset, managing the family money can turn into an emotionally driven series of ad hoc actions and reactions that almost guarantee unwelcome costs and taxes on top of disappointing returns. Read more > 

Financial Post: Managing Wealth  |  14 November 2009

How the rich stay richer

I’ll let you in on a little secret: Wealthy investors do not have any more insight into where the market is going than the typical Main Street investor. Read more > 

Financial Post: Managing Wealth  |  31 October 2009

Planning ahead a capital idea

You can’t take it with you. As aging Baby Boomers confront the harsh reality of actuarial tables, this adage takes on real meaning. Planning today must go beyond retirement and embrace the fact that we all eventually, as Shakespeare wrote, “shuffle off this mortal coil.” Wealthy families in particular, due to the size and complexity of their balance sheets, need to soberly consider the implications of this final certainty. Read more > 

Financial Post: Managing Wealth  |  17 October 2009

Arrival of the deca-millionaire

Millionaire. The word still has cachet despite decades of inflation debasing its lustre. According to research firm Investor Economics, in 2008 nearly a half million households in Canada were in the enviable position of having at least $1-million in investable assets. The overwhelming majority, nearly 95%, had between $1-million and $10-million. Read more >

Financial Post: Managing Wealth  |  03 October 2009

You may not be as rich as you think

For business owners who ultimately decide to liquidate the business they toiled away for decades to build, the influx of a multi-million-dollar portfolio can be quite liberating. There is now time to stretch one’s wings and fulfill those many dreams there was never room for before. Read more >

Financial Post  |  21 April 2009

It’s a recession, not a depression

As jobless rates skyrocket, numerous pundits have raised the spectre of the Great Depression, capturing headlines and garnering lucrative speaking venues as they prophesize inevitable devastation. Read more >

Financial Post  |  15 April 2009

The book your bank doesn’t want you to read

As jobless rates skyrocket, numerous pundits have raised the spectre of the Great Depression, capturing headlines and garnering lucrative speaking venues as they prophesize inevitable devastation. Read more > 

Financial Post: Managing Wealth  |  09 January 2009

It’s that big tomato you’ll want

There’s an old saying that if you want to win a contest for growing the largest tomato, paint a cantaloupe red and hope the judges don’t notice. Serious investors keep this principle in mind when they evaluate their investment managers. They don’t only look at performance, but also seek to identify the risks taken by a manager in order to sort the real performers — the large tomatoes — from the painted cantaloupes. Read more >