YOUR WEALTH MATTERS BLOG

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Your Wealth Matters

IS THIS INVESTMENT LEGITIMATE?

If you are not a professional in the investment industry, and sometimes even if you are, it can be difficult to evaluate the ins and outs of any particular investment.  Deciphering the fine print, especially when it comes to evaluating risk, can be especially difficult.  Most marketing material will tend to highlight the positive attributes rather than any potential negative outcomes.  The truth is that short of being a Guaranteed Investment Certificate (GIC), all investments will contain some element of risk that warrants careful assessment.  Whether you are looking at a website, reading a Fund company’s brochure, or meeting directly with a Portfolio Manager, make sure that the risks of any investment strategy are being adequately addressed.  And if not, ask, because anything that sounds ‘too good to be true’ is indeed a warning flag.

At Capstone, we value transparency.  This is why the varying types of risks that potential clients should be aware of are clearly outlined within our Information Memorandums – available across each of our Funds.  In addition to that, through meetings with clients and prospective clients we will walk through the various elements of risk that any of our Funds possess and reconcile that with a client’s personal risk tolerance.  Again, it is not the goal for clients to become risk experts, but rather to gain a general awareness that no investment is without risk.

As Portfolio Managers regulated at the highest level in our industry, we have a fiduciary duty to act in our clients’ best interests.  It is not only appropriate that we do so, but we are mandated to ensure that our clients have their risk tolerance properly assessed and that our portfolio strategies reflect this.  Upon agreement, clients will sign off on both an Investment Policy Statement, which outlines their unique objectives and determined risk tolerance, as well as our Acknowledgement of Disclosures, which very clearly outlines the risks that come with investing.

Janet Kim Sing, Portfolio Manager 
Capstone Private Wealth

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