The US Markets are up. The Canadian Dollar is up.

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Why isn't my portfolio going up too?

 

The US Markets are up. The Canadian Dollar is up.

The headlines are filled with great economic news. You ask, "Why isn't my portfolio going up too?” "Is there something wrong the assets in my portfolio?"

The assets selected for your portfolio for growth, are likely in US companies, for it is in the US' strong economy, with its much larger size that we find more predictable growth for your portfolio. This is good. So, what is wrong?

The Canadian Dollar is significantly up against the US dollar. So this means the reverse is true. The US dollar is down against the Canadian Dollar.

The US dollar is going down. It is represented in your portfolio by your US assets which, are growing in value, but they are growing in US dollars.

So, the net effect is that you do not see that asset growth on your statement. It is a currency issue.

Now you have to ask yourself, "Is the US Dollar going to stay down against the Canadian Dollar?"

You know we have no crystal ball, but that answer should be a reflection of the very strong and growing US economy. And we have no control over currency.

What does this all mean for your portfolio? When selecting options for your money to be put to work for you, and looking for growth, we are faced with two basic questions:

1. Do you buy something going up in value in a strong economy but with an issue from a strong Canadian Dollar?
2. Or, do you buy into the Canadian Stock Market that is down over the same period?

To be fair, this currency effect is a dizzying conversation for some of the Financial Industry's finer minds. But you and I should talk.

We are the Kingsmill Saar Wealth Management Group. We are in favour of securing your income from the Canadian Market and growth from the US. We have seen this before.

 

 

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