Term
investments: GICs sound choices for your portfolio
Author:
News Canada
(NC)—Both
first time and seasoned investors should consider term investments to provide
stable, predictable performance and to diversify their portfolio. Term investments
provide peace of mind for those with a low tolerance for risk or who rely
on their investments for income.
"Term
investments are an integral part of any portfolio," says Julie Sheen,
Vice-President, BMO Term Investments. "Your local bank branch can help
you to determine what portion of term investments you should incorporate
into your portfolio."
Term
investments, such as Guaranteed Investment Certificates (GICs) fully guarantee
your principal investment and provide a stable, predictable rate of return.
These types of investments can be easily converted into cash and tend to
be the safest category of investment options.
It
is this security that many risk-averse investors enjoy. Term products are
designed to help reach short-term financial goals, such as buying a car or
planning a family vacation, as well as to diversify a long-term portfolio.
Establishing
your investment time horizon will help determine what percentage of your
retirement savings portfolio should be held in term investments. If you have
many years before retirement, consider holding only a small portion of your
portfolio in security-oriented products. If retiring sooner, you should consider
moving your higher risk investments into lower risk products. You do not
want to risk losing any of your savings, as these will soon become a source
of income. An investment professional will be able to help you determine
the ideal mix of investments for your individual needs.
Information
provided by BMO Financial Group. For more information visit www.bmo.com/gic.
- News Canada
