Surviving the volatility on the financial markets

TORONTO, Ont. – Fresh off one of the worst trading weeks in years, which saw the TSX drop 6.5 per cent, investors are nervously exploring their portfolio and investment options.

The global financial markets have been extremely volatile in recent months, with worries about a slowing global economy and growing European debt weighing on investors.

But as Alan Small, a senior investment advisor at Dundee Wealth, says, the fact that many companies are cutting back on pension plans and benefit packs means many of us will need to stay invested in the market.

“The alternative to not being in the market may not be a good one right now, because you need that growth,” Small said. “Many of us need to see that growth, we can’t save for retirement or meet our goals earning one or two per cent.”

Small added that now may be the best time to invest in larger, stable companies, as we await a resolution of the debt situation in Greece. He also added that because of recent drops in the market there are bargains to be found.

“Today you can find great investments that are very cheap, this is probably the cheapest we’ve seen since coming out of the recession back in 2009, and in many cases probably the second cheapest you’ll find in nearly fifty years,” Small said.

As for the debt crisis in Greece, Small says we should likely have some sort of resolution within the next month.

Examining the Canadian economy specifically, Small says we are in better shape than most other nations, but the problem is our economy is heavily tied into what happens around the globe.

“We are definitely affected by what happens over in Europe and the U.S., and even in China, we are an exporting nation, so when countries around the world are struggling they may buy less from us,” Small said.

Regardless, Small believes now is the time to remain steadfast and play smart with your money.