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2021 Investment Expectations Balanced Funds Performed Well in 2020 Despite Covid 19 Volatility Clients who invested in I.A. Financial's new Indexia Balanced Funds received a 7.52% net rate of return for 2020...after all expenses. Last year was a tumultuous year with a March Stock Market crash, crazy politics and extreme lockdowns. Fortunately, the Indexia Balanced Funds with their lower MERS (Management Expense Ratios) came through as planned.﷯ Client's with higher Risk Profiles who invested in the Asia Pacific Fund received an astounding 44.42% rate of return (despite all of Trump's tariffs). While at the same time Nasdaq Investors received an amazing 41.51% net rate of return mainly due to the FANG Stocks. On the downside, clients received temporary losses with the Real Estate Fund which was down (-10.11%) due to Covid 19 disruptions. The Real Estate Fund should fare much better as the Economy opens up. What Should We Expect in 2021? There is renewed optimism with the distribution of several Vaccines (Pfizer Inc. being one) which should be reflected in a strong start to the 2021 Markets. Although, the first half of 2021 is going to be very difficult in regards to the spread of Covid19 the second half of the year is anticipated to be much more positive. For new monies moving into investment funds (Segfunds) I recommend six months of Dollar Cost Averaging to create a bridge over the time period needed to complete Covid 19 Vaccinations. The advantage of Dollar Cost Averaging Funds into the Market is that it lessens the risk of timing the Market perfectly. By gradually investing your Funds each month over a six month period any losses will be minimized in the event the Market drops. Similar to last year, I recommend taking a Barbell Approach but this year I suggest that clients be more growth orientated than in 2020; in order to take advantage of the lower for longer interest rates courtesy of the Bank of Canada. This year one end of the Barbell should be conservative but down from 60% to 40% in Fixed Income, Credit Union GICs and Lifeco GICs. The other end of the Barbell should contain sectors such as Materials, Energy, Industrials, HealthCare, Infrastructure, Financials and Tech.

Materials, Energy. Industrials, Healthcare, Infrastructure. Financials, Tech. 60%

BONDS GIC'S

20%     20%

Recommended Asset Allocations For Retired Clients Investment Vehicle % Holdings Risk Tolerance/Strategy Credit Union / LIfeco GICs 20% Very Conservative Growth Bonds/Corporate Bonds 20% Conservative Canadian Dividend & Diversified Funds 20% Moderate Growth Global Funds/ USA,Europe,Asia 15% Growth Global Infrastructure 15% Growth Global HealthCare 5% Moderate Growth Canadian Real Estate 5% Growth Total Asset Allocation 100% Conservative/Moderate Growth 
SEGFUNDS PERFORMANCE 2020 FUNDS 1YR 3YR 5YR 10YR INDEX BALANCED 7.52 6.18 5.58% Canadian Diversified Fund 7.93 4.92 3.55 4.39 Canadian Dividend Fund -2.04 2.12 5.99 5.04 USA Dividend Fund 6.16 5.38 4.97 9.51 Global Equity Fund 11.31 5.85 5.33 8.44 Global Heath Care 8.66 10.21 3.91 14.33 Asia Pacific Fund 44.42 17.10 13.76 8.32 Real Estate Fund -10.11 1.94 4.84 5.72 Note: *10 Year simulation of past returns as if the fund or series has been in effect for those periods. Guaranteed GIC's 1YR 3RY 5YR BC Credit Union .80 1.50 1.35 BC Credit Union .15 (1 Year cashable after 30 days) Canadian Lifeco .75 1.40
Comments When Management Fees from Segfunds are melded with Credit Union GICs or Lifeco GICs the combined MERS very often amount to only 1% which includes our time and expertise along with the Life Insurance Company's experienced Financial Analysts. Together your Investments are professionally managed to sustain and build your Retirement Portfolio. It is important to distinguish that Lifeco GICs are competitive these days with the added benefit that they can avoid Probate Fees and can afford Creditor Protection. Lifeco Segfunds and GICs are payable directly to the named Beneficiary and therefore avoid Will disputes and Lawsuits as the proceeds fall outside the Wills Variation Act. These are wonderful attributes of Segfunds and Lifeco GICs for clients who are elderly and concerned about efficiently passing their Estate to the next generation. Bank GICs and Mutuals Funds pass through the Client's Will "even if a Beneficiary has been named". As always, I am available to answer questions or to arrange a Telephone Meeting...my cell is 250-881-2423 and my e-mail is rick@rerinvest.ca Kindest Regards Rick Reynolds CLU ChFC E&OE

Contact Us:

Please contact us if you have questions

or would like us to prepare a custom service

package based on your needs.

 

 

Tel : Rick (250) 881-2423

        Rob (250) 220-0495

email: info@rerinvest.ca

Victoria Office, 670 Newport Ave

Victoria, BC  V8S 5C7

 

North island Office, 3713 Shoreline Drive,

Campbell River, B.C. V9H 1L8

R. E. Reynolds Investments

& INSURANCE SERVICES LTD.

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