Building Wealth

For the first 30 or so years of working, saving and investing, you’ll be first in the mode of getting out of the hole (paying down debt), and then building your net worth (that’s wealth accumulation.). But don’t forget, wealth accumulation isn’t the ultimate goal. Decumulation is! (a separate category here at the Hub).

How to stay calm and Invest confidently amid Stock Market Fluctuations

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Letting unnecessary stock market worries take hold of your investment decisions can lead to much bigger problems than just finding stocks to buy

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Our early ancestors had to be on guard against threats in their environment. They were under constant threat. At night, if you woke to every sound from the bushes, you lost some sleep, but you cut your risk of being eaten by a lion or killed by an enemy. Today we face much less risk from animal predators and human marauders. But many people still carry this hair-trigger fear response. We spend more time than we should worrying about things that will never happen. This includes stock market worries.

That’s especially true of investors, who generally think more about the future than other people. It’s true all the more of subscribers to our newsletters and members of my Inner Circle service.

Understand stock market worries and risk so you can put everything in perspective

That’s because many of you are the kind of people who seek out investment information from a variety of written sources, where it’s much more extensive and detailed than what you get from a glance at the headlines, the evening news or cable TV. However, some of that information is biased, overblown or incorrect.

This doesn’t mean you should ignore potential threats. You just need to put them in perspective.

Learn what experienced investors do about common stock market worries

There is never a shortage of ways to ease your stock market worries. “You never go broke taking a profit,” is a favourite of brokers I’ve met over the years. They used them to spur their clients to do more trades, to boost their own commission income.

Our view now is that stocks are still a good place for your money, if you can afford to stay invested for several years. If you expect you will need to take money out of your portfolio, you should think about selling sooner than you need to.

Look beyond immediate stock market movements to help reduce your anxiety and stock market worries

Stock market trends are the general direction in which the stock market is heading. These market trends are dictated by a number of factors: what sector investors favour at the moment, economic and world news, interest rates and other trends from industries such as technology or resources, and so on. These trends could be positive or negative, and they could lead to a huge boom for a stock market. They could also lead to a big downturn. Continue Reading…

How to attract Buyers for your Private Practice

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Are you struggling to attract new clients to your private practice? With so many options out there, it can be challenging to know where to start when it comes to marketing your services. However, some tried-and-true strategies can help you stand out and attract new clients to your practice. With some of these tips you can your methods in attracting serious buyers and highlight your business’ value.

Image courtesy Logical Position/Adobe Stock (Arnéll Koegelenberg)

By Dan Coconate

Special to Financial Independence Hub

Whether it’s a law office, accounting firm, dental office, or other type of private practice, selling a business is an important and challenging step to take. Of course, you want to ensure you get a fair price, but don’t neglect to look beyond the financial angles as well. If you want to protect your legacy and find the right buyer, the following proactive steps will help you prepare and market your practice, making it a hot commodity and ensuring a smoother transition.

Here’s how to attract buyers for your private practice.

Highlight what makes your Practice Unique

When buyers purchase a private practice, they’re not just buying a business. They’re also acquiring a long-standing reputation, client base, and operational structure.

You can begin the selling process by identifying what sets your practice apart and makes it special compared to competitors. Do you offer specialized services? Do you have an established, loyal client base? Is your location particularly advantageous? Answer these questions, and put these strengths front and center in your marketing materials and presentation. Highlight the unique benefits your practice offers compared to others in your field for a greater advantage.

Organize your Financial Records

Provide potential buyers with a clear understanding of your practice’s financial health. Ensure that all of your financial records are in order and up-to-date with accurate data on revenue, expenses, profit margins, and client retention rates. Transparent and well-organized financials instill confidence in buyers and demonstrate that your business is a sound investment.

Establish a Transition Plan

Buyers value efficiency. As you begin to think about selling, develop and refine your practice’s systems. Slowly reduce the practice’s dependence on you to make daily decisions. If your current staff members are staying on, appoint new duties to staff and train them to take on more responsibilities. This can make the transition easier for the buyer, employees, and clients. A business that runs smoothly and that is obviously scalable and sustainable is more appealing to potential buyers. Continue Reading…

Surviving a “Bear Scare” in or just before Retirement

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By Billy and Akaisha Kaderli, RetireEarlyLifestyle.com

Special to Financial Independence Hub

It’s everyone’s nightmare: watching retirement assets vanish in a bear market, especially in or just before retirement.

Many of you will remember the severe market downturn of 2000-2002, the Dot Com Bubble, when the Standard & Poor’s 500 Index fell 37%.

We’d be lying to say that this declining market didn’t affect us. Our finances dropped about the same as most others on a percentage basis. As retirees, with no regular paycheck coming in on Friday, this event could have spelled disaster for our future plans of maintaining our financial independence.

Then there was the 2007-2009 “Great Recession” where the market fell by almost 50% lasting 17 months, testing our courage.

The 2020 Covid scare shook the market’s foundation, earning the title of the “shortest bear market” in the S&P 500 history lasting only 33 days.

And now here we are again in 2025 where the market is almost in the grip of a bear. How much longer will this last? How low will we go?

What should we do? How do we cope?

First, we’ve learned from past bear markets the importance of some cash flow. Having aged a bit and now receiving social security we have adjusted our portfolio to a more balanced one adding DVY, iShares Select Dividend ETF as a dividend-producing asset as well as increasing our cash holdings.

Then, there are regular chats about our finances and the state they are in, in hopes of averting a possible worst-case meltdown. We have discussed the fiscal facts and tried to extrapolate them out into the future.

One obvious problem: No one can predict the future.

Friend asks “Billy, why are you investing now? You know the market is crashing, right?” Same friend 10 years later: “Hey Billy I heard you retired early. How did you do that?”

Using history as a guide

Researching bear markets, we take heart from the knowledge that past downturns always ended.

Retiring is definitely easier when markets are rising as compared to when they are falling. But how do you know if you are in a rising or falling market? That depends on your starting point and there has been no 20-year rolling negative returns.

Another question to ask: is this is a good time to buy equities? For every buyer there is a seller and they both think they are right. Maybe the cure for cancer will be announced tomorrow or the global economy will collapse. We just don’t know.

That’s the point.

This is why you need to create the mental confidence to ride out these fluctuations and not panic out of the market. Continue Reading…

Betting on Markets being Wrong: Don’t take those Odds

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Capitalizing on Market Mispricing is Easier Said than Done

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By Steve Lowrie, CFA

Special to Financial Independence Hub

A common refrain in investing is that news and expectations are already “priced in.”

I often say this publicly and in individual client meetings. When clients are concerned about changes in the market and want to act on what they are hearing, I remind them that the market is ahead of the media rumblings and that snap financial decisions tend to sabotage positive financial outcomes.

So, it is much better to hold firm with your investment strategy, which should be based on a sound financial plan, rather than reactively sell, because those who react are most likely reacting too late.

And I’m not just guessing. I’m advising based on my experience and deep understanding of how markets work. The reality is that those who stay disciplined see much better performance than those who try to bet on market mispricing and make changes.

“Priced In” vs. Market Mispricing

How does the “priced in” concept apply in real-world market scenarios?

Take a recent client meeting, for example. It was March 3rd, the same day U.S. President Donald Trump announced that the 25% tariffs were officially moving forward on March 4th. My client asked,

“If the market is so efficient, how is it that stocks dropped 2% after the news broke? Shouldn’t that have already been priced in?”

When something is “priced in,” it means the market has already adjusted asset prices based on available information. Markets are forward-looking, incorporating not only what is known but also expectations about the future. In the case of the tariffs, if there had been a 100% certainty that a sweeping 25% tariff would be announced, the 2% drop would have already occurred beforehand. The fact that the market reacted afterward suggests that the market collectively expected some form of tariffs: but not a 25% hit across-the-board.

Similarly, consider a corporation’s earnings report. If a company is expected to post strong results, its stock may rise in advance as traders anticipate good news. But when the earnings are released and match expectations, the stock might barely move: because the market had already priced it in. Conversely, if expectations were too high, the stock could even fall despite good results. The paradox? A company can report strong earnings, yet its stock price still drops.

So, the question “Shouldn’t that have already been priced in?” is the wrong question to ask, as usually the underlying theory is “Everyone has been expecting this, I should have sold (or bought) the moment I heard about this coming!” The correct question to ask is “If I am assuming or betting on the markets being wrong, can I consistently and systematically profit from this?”

The answer to that question is a resounding “No – the vast majority of people can’t.” The reality is that reliably predicting the market in advance and capitalizing on it is not as easy as it seems – otherwise everyone would be a winner, and no one would lose – and we know that’s not what is happening.

Charlie D. Ellis, a renowned investment consultant, illustrated this perfectly in his book “Winning the Loser’s Game.” Risk-taking investors are like amateur tennis players; they try to make big plays but make lots of mistakes, so they ultimately lose. Whereas successful investors are like professional tennis players; they focus on being confident in their game and not making errors; instead, they exploit the errors of their opponents. So, it’s important to think about who is on the other side of the net, as it relates to investing. Investors who attempt to outmaneuver the market are playing against an unknown and faceless opponent.  In reality, the opponent is most likely a professional or institutional investor, who is highly educated and experienced and have a variety of technical tools and super computers to help them.

Quite often, I or my clients hear some anecdotal story of  a friend of theirs who sold at the right time or bought at the right time because they anticipated a change in the market. The truth is that if when someone takes a risk and wins, it is glorified: both in the media and in discussions by the water cooler. No one ever hears about those that lose. That’s not because they don’t exist; the losers far outnumber the winners. You don’t hear about them because, unlike the proud winners, the losers are scuttling away quietly with their tails tucked between their legs. I wrote about this phenomenon in my recent blog, “Real Life Investment Strategies #6: Beware the Risk of the Cult Stock Roller Coaster.”

Uncertainty and the Role of Spreads in Sports Betting

The idea of pricing in information isn’t unique to financial markets: it’s also central to sports betting. Bookmakers set point spreads based on team performance, injuries, betting trends, and even public sentiment.

Imagine a hypothetical hockey game between a professional NHL team and a top junior team. Some of the junior players might eventually make it to the NHL, but right now, the talent gap is massive. If you had to bet on the outcome, the NHL team winning is almost a certainty. But oddsmakers don’t just offer a simple win/lose bet: they set a goal spread to even things out.

Let’s say the spread is 20 goals. That means for a bet on the NHL team to pay out, they must win by at least 20 goals. This is where market efficiency comes in. If the spread were too low — say, 5 goals — everyone would bet on the NHL team, forcing bookmakers to adjust the line. If the spread were too high — say, 30 goals — more bets would come in on the junior team. The goal spread balances betting interest, just like stock prices adjust to reflect available information. Continue Reading…

Trump Tariffs lead to Trade War: What investors can do now

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Image via Pixabay

By Kyle Prevost, MillionDollarJourney

Special to Financial Independence Hub 

With so many Canadians plugged into the latest Trump Tariff news, I felt that I needed to get an updated trade war column out as soon as possible!

So what I’m going to do today is update an article I wrote back when we were taking our first baby steps into Trump Tariff reality. Below you’ll see a ton of info on what tariffs are, what Canada’s situation is in regards to the big picture effect on our economy, and finally, what the impact is likely to be on your portfolio.

But first, just to bring you up to speed, here’s what the President announced in his big “Liberation Day” speech – complete with grade-five-science-fair-style cardboard visual aid.

  • A baseline tariff of 10% will be imposed on nearly all imported goods from all countries. This tariff is set to take effect on April 5, 2025
  • Canada and Mexico will not – for the moment – be part of that 10% baseline tariff.
  • Canada and Mexico trade is basically now broken up into three categories: goods that are USMCA-compliant, goods that are not UMSCA-compliant, and goods that are in sectors that Trump wants special rules for.
  • USMCA-compliant goods are actually in the best spot of any imported goods in the world right now – as they get to enter the USA tariff-free!
  • Goods that are not UMSCA compliant are still under the 25% “Fentanyl Tariff” rules.
  • We already knew about potash and fossil fuels having their own 10% tariff rules, but it appears that lumber, steel, and aluminium will continue to have their own special place on the Trump Tariff list as well.
  • Likely the biggest Canada-related news was that the 25% tariff on automobiles will be applied to Canadian-made vehicles (despite the USMCA explicitly outlining this as being illegal).

In regards to the rest of the world, the most noteworthy developments were:

  • An additional 34% tariff on China, resulting in a total tariff of 54% when combined with existing duties.
  • European Union: A 20% tariff.
  • Japan and South Korea: 25% and 24% tariff respectively.
  • India: 26% tariff.
  • Vietnam: 46% tariff.
  • Many many many other tariffs.

As we hit publish on this article, countries around the world were announcing retaliatory tariffs and US stock market futures were showing that the overall US stock market was set to lose 4% as it opened on April 3rd.

The best quote that I heard in regards to summing up this whole mess was from Flavio Volpe, president of the Automotive Parts Manufacturers’ Association who stated that the new tariff situation was “like dodging a bullet into the path of a tank.” He went on to write, “The. Auto. Tariff. Package. Will. Shut. Down. The. Auto. Sector. In. The. USA. And. In. Canada,” and then, “Don’t be distracted. 25% tariffs are 4 times the 6/7% profit margins of all the companies. Math, not art.”

It appears that the rest of the world is finally waking up to the same reality that Canada and Mexico have been experiencing for the last two months. There’s much more that could be written about the gnashing of teeth and simply incredible quotes from the President such as, “An old-fashioned term that we use, groceries. I used it on the campaign. It’s such an old-fashioned term, but a beautiful term: groceries. It sort of says a bag with different things in it.”

Oooook.

For now, take a deep breath and read what I had to say a month ago in regards to your stock portfolio. The reality was true then, and it’s true today. In my predictions column back in late December I wrote:

“One of the most pressing questions for Canadian businesses in 2025 is whether the newly elected U.S. president will follow through on his promises of large tariffs on Canadian imports.

Trump’s fixation on trade deficits could lead to a significant shake-up in the global economy. He appears intent on generating tariff income to support the legislative groundwork for corporate tax cuts. His “national security” justification may lack substance, but it could still trigger sweeping trade policies. 

I don’t actually believe that Mr. Trump understands how trade wars actually work, and he hasn’t cared to learn anything new in several decades. So the hopes better angels will talk him out of this are perhaps misplaced.

I believe even more strongly that the President-elect doesn’t understand how trade balances work, and consequently, he does not understand that in buying goods from Canada with a strong US Dollar, his constituents (US consumers) are winning! There is no “subsidization” of Canadian business going on here. 

While a blanket 25% tariff on all Canadian goods seems unlikely, a more targeted 10-15% tariff on non-energy products feels probable. If that happens, Canadian businesses would face a challenging environment, and retaliatory tariffs from Canada could escalate tensions further.

My guess is that we’ll see some major disruption in Canadian manufacturing, with supply chains snarled, and some factory commitments being delayed indefinitely as companies decide to move more operations within the USA for the next few years at the very least. I’d also be pretty worried if I was a farmer and/or worked in the dairy industry. Some of these tariffs might come off when the overall North American trade deal is finalized.”

I’d say that held up pretty well!

The key here is definitely not to panic. The Canadian stock market has actually held up pretty well so far – and as always, it’s key to remember that the vast majority of the companies in Canada’s stock market DO NOT depend on selling specific goods to the USA. It’s also worth noting that a lot of companies that weren’t previously UMSCA-compliant are likely to become so in a hurry. If that happens, there might actually be a lot of Canadian companies in an enviable position relative to the rest of their global competitors as they will have no tariff to worry about (for now) versus 10%-50%+ for other countries.

This isn’t going to be good for any of the world’s economies, but the Trump Tariffs are already proving very unpopular with US Citizens and even among Republican politicians. Read on for more detailed reasoning on why you don’t need to do anything drastic in the face of these latest Trump tariff developments, and the broader US – Canada Trade War that has now expanded to include the rest of the world.

Trump (Delayed) Tariff Details

So – what is a tariff anyway?

A tariff is a tax by a government on foreign goods coming into a country. The import company (or person) pays the tax to the US federal government. In the vast majority of cases, the company then turns around and sells the imported product for a higher price (and possibly also takes a hit to their profit margin).

Trump’s tariff summary:

  • A 25% tax on all imports – aside from oil. This happens on Tuesday, February 5th.
  • A 10% tax on oil. This is supposed to kick in on February 18th.
  • Mexico will see a 25% tax on all of its imports.
  • China will get a comparatively light 10% tariff on its imports.
  • Canada will respond with two-phases of tariffs in response. They will total $155 billion of US goods.
  • Mexico hasn’t finalized details but announced tariffs ranging from 5% to 20% on US imports including pork, cheese, fresh produce, manufactured steel and aluminum.

If you’re wondering what we send to the USA – it’s a lot (we don’t have 2024 numbers finalized yet).

top us imports canada
Source: CBC News
trade dependancy
Source: Council of Foreign Relations

The potential fallout from U.S. tariffs looms large. If the worst-case scenario unfolds and these tariffs stay on Canadian companies for more than a month or two, economists estimate it could push Canada into a three-year recession, shave three percentage points off our GDP, and wipe out 1.5 million jobs. While forecasts vary, one thing is clear – the economic risks are significant. It would likely be even worse for Mexico.

The USA isn’t going to get off the hook easily either. Predictions range between their GDP shrinking .3% to 1%. That range doesn’t give a precise picture of the fact that counter-tariffs will be heavily targeted with the goal of inflicting maximum pain to companies that are important to Republicans’ electoral chances. I wouldn’t want to be in the US alcohol or consumer goods business right now.

American consumers are going to immediately see higher prices on agricultural goods, lumber (which means more expensive houses), gasoline (especially in the midwest), and vehicles.

When it comes to cars, the idea that the tariffs will somehow shutdown Canadian factories and move them to the USA overnight is ridiculous. What will happen is that the complex supply chains involved for North American manufacturers will get much more expensive, and consequently it will make the final product more expensive. Continue Reading…