Courtesy of Claire Sarda from Redsell-Seguin and Associates.
A Financial Recap on 2011
As we close out 2011, a heavily volatile year for stock markets, we breathe a sigh of relief that the year is now behind us. Some stock indices finished the year higher like the US Dow Jones Industrial Average, some lower like the Canadian S&P TSX. However, European markets by far took centre stage throughout 2011.
To recap, each quarter of 2011 was captivated by headline news. There was the earthquake and Tsunami in Japan in the first quarter, the European Sovereign debt crisis re-surfacing during the second quarter, the US debt ceiling debate in the third quarter, then followed by an escalation of the European debt default and contagion turmoil in the fourth quarter. Not to mention the unnerving sporadic unrest in the Middle Eastern regions and countries downgraded by rating agencies, as well as concerns of potential downgrades in 2012 have made 2011 a challenging year for most investors.
Even with resolutions to some of its uncertainties, Europe will most likely continue to be the focus in 2012. US will be in an election year with possible changes to its political landscape. China is expected to have a lower, but still strong GDP growth of greater than 8%. Interest rates worldwide are expected to remain at current low levels. Emerging markets have fallen to more attractive valuations and there are expectations they may outperform some of the developed economies and significantly add to global growth. This will have positive implications to our resource rich Canadian economy.
All this to say that investment markets can continue its path of strong rallies followed by minor corrections, and the occasional short lived major pullbacks and smaller rebounds. Now more than ever, the need to extract emotions and sentiments out of investing is critical to your portfolio.
I am always mindful of the investment environments and any impact it may have on your portfolio. Market fluctuations are part of investing. However, staying the course of a well diversified portfolio will ultimately win the race and help achieve your long term investment objectives.
I wish you a very healthy and happy New Year.
For more information on related topics, please contact DFS Private Wealth, the author of Managing Alone and founder of widowed.ca. We are here to help and answer any questions you have. Should you need a connection to a professional in your area we would be happy to make the introduction for you to someone you can trust. Contact Us today.