Canadian Personal Finance News | August 2016

July's list of the best Canadian personal finance news, articles, and blog posts from around the internet, expertly curated for interest and relevance.

"The market average is made up of hundreds of stocks being traded by millions of people around the world, each with their own lives and stories and perception filters, and even though it will all average out to a single, simple result (up/down/flat), it is not because of a single, simple cause."

"“Sell everything” or “buy now” or “head for gold” makes great headlines, but isn’t great strategy for individual investors.

The reason isn’t that the market observers are reading fluctuations and trends differently than individuals, using specific technical analysis or analyzing contrarily the fundamentals. Nor is it that the experts are always wrong, no matter how popular that sentiment might be.

The issue is that money managers run money, while individual investors run their own lives."

"While these strategies can be important to the longevity of your early retirement plan, they are completely useless if you’re unable to save or control your spending habits."

"The worst time to completely change your strategy is following huge gains that you missed or huge losses that you didn’t."

"the volatility of the individual parts does not equal the volatility of the overall portfolio"

Is year-to-date a performance metric we should really care about?

"alpha is a HOPE that is sold to the average asset allocator in exchange for the GUARANTEE of higher fees"

Smart beta is a relatively new term, but its roots stretch back several decades. Let’s look at the history of how the idea developed.

"Education makes almost no difference at all. This is not to say no one learns anything — poor people can come out wiser, for sure. But it’s not enough. 'It’s like teaching a person to swim and then throwing them in a stormy sea,' laments Professor Shafir."