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By: Ashley Ford
The Province
Friday, July 26, 2002
Small investors should stick to their guns, continue doing intense
homework and stop watching the wild gyrations of the stock market,
say Vancouver investment advisors.
“Do your homework, the patient and ride out the storm,”
said Chris Carter, investment columnist, as North American stock
markets took investors on another choppy ride yesterday.
Adrian Mastracci, president of
KCM Wealth Management, says “If stocks have that risky feeling,
prune them gradually. If stocks have that bargain-bin feeling, buy
them gradually.”
Wall Street dipped in and out of positive territory all day and
Toronto did even less well as Nortel Networks fell 20 percent, or
36 cents, to a new low of $1.42. And telecom services dropped 6%
as Telus shares dropped nearly 24 percent, or $2.15 to $7.
Carter said “don't try and time the market, that is absolute
nonsense. Don't sell out or jump into the market in panic,”
he said.
“Stop reacting to every daily market sneeze and hiccup,”
advises Adrian Mastracci, president of KCM
Wealth Management Inc.
“Avoid making emotional and hasty decisions. If stocks have
that risky feeling, prune them gradually. If stocks have that bargain-bin
feeling, buy them gradually.”
“Diversify, diversify, diversify. Not more than four to five
percent in any one stock.”
Despite reports that Canadians were pulling billions out of mutual
funds, Mastracci said there is no real evidence investors here were
panicking.
If you really can’t stand the pain there might be some gain
at income tax time if you take the loss. The decision to sell should
always be based on sound investment factors rather than potential
tax benefits. A loss realized this year can be applied against capital
gains as far back as three years ago. Or it can be carried forward
indefinitely on future capital gains.
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