There are many different investing styles that people like to term…such as “growth”, “value”, “indexing” or “dividend-based”. Each of these have merits depending on the situation you find yourself in, but my unique approach is to always incorporate one or more depending on my specific investment objectives. Although my concentration is as a value investor, I am invested in multiple strategies to achieve a wide variety of goals over the short, medium & long term.
Although my main portfolio surrounds the value principles and rules I’ve outlined before, I also have an emerging portfolio of dividend growth stocks, a self-designed healthcare mutual fund and my RSP is made up of index funds, low-fee MF’s and income generating securities.
It is my strong belief that no one philosophy is always right or wrong. I’ve learned that investing is more than asset allocation, diversification, emotion or knowledge. It’s about setting specific goals for what you want to achieve and understanding that this includes “complete diversification”.
An old friend once shared with me his strategies: he held about 4-5 portfolios, with each holding a specific goal: some short term, some medium term & some long term. He didn’t consider himself to be a value or growth investor, but a combination of what best fit his intentions. His long-term investments were largely ETF and dividend stocks, his middle-term investments were indexed or no fee mutual funds and short term mostly in high-interest savings accounts & GIC’s.
With so much emphasis today in the media & from financial professionals with cutting edge software, computer programs or tracked strategies, the investment choices are both confusing and often frustrating for many individuals. Yet this strategy is very similar to the health teaching I provide patients about weight loss. It’s always important to remember balance. There will always be something trendy, flashy or new to come along next week or month, but it’s more about developing a discipline that allows you to achieve both success & flexibility within your own limits.