You invest to achieve your financial goals. They may be near-term or several years away. Improving your investment know-how helps you make informed choices and protect your financial interests.
Whether you are starting out or consider yourself a seasoned investor, your approach should always start with some basics.
First, set your investment goals. They could be saving for your child’s education or for your retirement.
An investment advisor can help. Do some research to find the right advisor and get to know him or her. Make sure he or she is registered with a regulator. Ask questions about the background, the education and the qualifications of the advisor you are considering.
When you open an account with an investment advisor and for ongoing maintenance of your account, you must provide information about your personal and financial circumstances. Most investment firms are required to determine the suitability of each proposed transaction in your account, whether the advisor suggests the investment or you do. Your firm and advisor need to fully understand your financial situation, investment needs, objectives, investing experience and tolerance for risk. This requirement is part of the Know-Your-Client rule.
As for your investments, the more you understand what’s available, the better informed your choices will be. Different kinds of investments carry different levels of cost, risk and return for your money. The ones that are right for you depend on how much you are investing, for how long a time, what return you want to make and how much you can risk losing.
Because you have money to invest, you can also be a target for fraud. It is key to know how scam artists operate and to recognize when a promise of easy money is too good to be true.
Financial markets operate under regulations, set and enforced by organizations in your province and in other parts of the country. Get acquainted with their roles. It can help later if you have a question, concern or complaint.
IIROC wants to help investors protect their financial interests with tools to analyze potential investments and guard against unsuitable or fraudulent investments.