g in si de ha lto n. co m O ak vi lle B ea ve r | T hu rs da y, F eb ru ar y 1, 20 18 | Interest Rate Changed - Should Your Portfolio? This week, the Bank of Canada bumped up the interest rate by 0.25%, to 1.25%. While this decision shows that our economy is strengthening, it raised some concerns among investors, particularly those who own bond funds, also known as fixed income. The reason for their worry, is that when rates go up, bond prices go down. So this week's rate hike, has led some investors to question whether they should scale back or dump their bond funds. There are no straight answer to this question because there are a number of variables which are too complex to cover in this one post. But there are a couple of rules of thumb that we can offer to help guide investors. Bonds Have Different Levels o f Sensitivities Bonds are really just an IOU. When you buy a bond, you're giving a loan, and in return, you get a regular stream of interest payments until the borrower returns your loan in full (i.e. the bond's term). When rates go up, this has less of an impact on short and medium term bonds (bonds with terms between 1 to 5 years). The simple explanation is that lenders and borrowers only need to accept the lower interest payments for a shorter time. So the recent interest hike had less of an impact on this group of bonds. Bonds Play a Unique and Im portant Role It's important to understand that bonds, like other asset classes, have a specific role in a portfolio. Whereas equities are meant to provide the potential of growth, the main responsibilities of bonds are to provide stability to your portfolio. As equities and bonds tend to perform in opposite directions. That is, when equities are performing well, bonds are slowing down. Since market conditions change continuously, including a mix of equities and bonds into your portfolio helps to minimize the return fluctuation in your portfolio. This is particularly important for the investors nearing retirement who need more stable and consistent returns. For more personal finance tips, sign-up for our free Nest Wealth newsletter: learn.nestwealth.com/newsletter/ O Nest Wealth Did you know that hearing is our only sense that is constantly active? Improve your hearing. Improve your life! Call us at 647-933-2640 to book your FREE hearing test today! Bronte Village 100 Bronte Road, Unit 6 Oakville, ON, L6L3B6 hea rin g exce lle nce .ca 'Promotion on selected hearing aids is valid till March 31st, 2018. "On selected hearing aids. Some condKions apply subject to credit approval by the vendor on 0% interest and 12 month Payment Plans. Processing lees depending on the vendor may vary. Welcome to KKT Orthopedic Spine Center We are a new innovative treatment center for sufferers of back, neck and other chronic pain. KKT is a non-invasive, painless and fast treatment option which uses low- frequency sound waves to correct the position of the spine which results in pain relief, improved strength and mobility and may avoid the need for surgery or prolonged use of medication. KKT is scientifically proven, FDA and Health Canada approved and utilized in the treatment of many acute and chronic conditions such as: Back pain, Headaches, Neck Pain, Bulging Discs, Herniated Discs, Sciatica, Osteoarthritis, Whiplash, Scoliosis, Knee pain, Hip pain, Healed Vertebral Fractures and Facet Syndrome. We fix the cause of the problems that you are suffering from, we don't just treat the pain. KKT has been safely applied 450,000+ times over 15 years and now has 24 centers across 11 countries. We are pleased to inform you that the inventor of this new technology, Dr. Aslam Khan, is currently based out of our new clinic in Streetsville Mississauga. Our team looks forward to providing this treatment option to residents in Mississauga and surrounding areas. KKT is the solution people are seeking. Let us help stop your pain from taking away the things you love to do in life, and put an end to needless suffering. Please visit our website www.kktspine.com to learn more. We invite you to visit us at our new location 370 Queen Street South. For more information please call 905-285-0005 or email toronto@kktspinetreatment.com. As distinctive as you are You are unique. Your family is unique. Ask our trusted specialists about personalized options for lasting remembrance, and preserve the memory of one special life forever. Call today to take the first step; 905-257-1100 glenoaks.ca Q LookforusonFacebook Arbor Memorial Inc. Family Owned. Proudly Canadian. 3164 Ninth Line (403 & Dundas St.), Miss./Oakville, ON Glen Oaks Funeral Home & Cemetery byArborMemorial http://www.kktspine.com mailto:toronto@kktspinetreatment.com Bonds Play a Unique and Important Role For more personal finance tips, sign-up for our free Nest Wealth newsletter: learn.nestwealth.com/newsletter/ Call us at 647-933-2640 to book your FREE hearing test today! Call today to take the first step; 905-257-1100 glenoaks.ca