March 01, 2022Money Education Financial literacy Economy Lifestyle
What Helps In Times Of Market Volatility?
Gas prices are at all-time highs. The Bank of Canada raised interest rates. A head of cauliflower is $6.99. Clearly, we’re living in an overheated economy.
So what does this mean to investing? At Allan Bush Investment Team, we’ve made it our standard to invest our clients’ money in securities that produce what they need to meet their goals, regardless of market ups and downs. In today’s economic environment, this continues to be true.
In simple terms, market volatility is often high when inflation is also high. And we’ve seen this over the last several months. During this time, we continue to follow our time-tested process to purchase dividend-paying securities, as this asset class is known to help smooth volatility in times of market uncertainty. Why?
Dividend-paying securities can make your money work harder than most other investments because regardless of how the stock performs, the yield produces a nice recurring rate of investment return. When we think back to our Chicken and Egg analogy, it’s our chickens laying their eggs that help create something you can count on even in times of uncertainty.
As a result, dividend-paying stocks can be a good place to put your money when markets are turbulent. This is largely because they are less volatile than other stocks, as most investors are willing to hold onto them through all market cycles.
That why, for more than 25 years, our investment philosophy has proven successful, and our clients have been able to consistently rely on a predictable and stable component of their total portfolio return that produces what they need, when they need it. For this and any other investment questions you may have, feel free to reach out to a member of our team at any time.