Part Of A Well-Balanced Portfolio
Owning stocks is important for long-term investors because they can potentially yield higher returns than any alternative. But to benefit from better returns, you must be willing to accept greater risk. Despite these risks, all but the most conservative of investors, should include stocks in their portfolio because they can produce above-average returns over the long term.
Finding Stocks That Are Right For You
By holding stocks, you own part of a company and have a vested interest in how it performs. There are two types of stocks: common shares and preferred shares. Common shareholders are the owners of a company and provide the equity capital to carry on or expand the business. With common shares, you may have the right to participate in choosing the company's board of directors, executive officers or making other key decisions that could affect the fate of the company. Preferred shares entitle you to dividends and have a claim on company income before it may be distributed to other shareholders. As an investor, you need to look beyond these classifications to determine the characteristics of any specific share.
Companies offer thousands of stocks with different features, prices and privileges to investors. Sorting through these choices to find what's right for your own portfolio can be overwhelming. That's where the value of professional advice is essential. Your CIBC Wood Gundy Investment Advisor can provide invaluable insight and access to the world of stocks.
Benefits Of Stocks
Stocks offer the following advantages:
- Common shares provide excellent long-term growth potential
- Possible dividends to shareholders, if there is any extra company profit after paying expenses
- Preferential tax treatment of capital gains, and for Canadian dividend income
- Typically outperform the rate of inflation over the long term
- Part ownership of a company; possibility of influencing company direction
Secure The Help You Need
Together with the expertise of your CIBC Wood Gundy Investment Advisor, you can select equities to build a portfolio that takes into account your investment risk profile, time horizon and goals. To find out how we can help you, use our Find An Advisor tool to contact a CIBC Wood Gundy Investment Advisor near you.
The information contained herein is considered accurate at the time of posting. CIBC and CIBC World Markets Inc. reserve the right to change any of it without prior notice. It is for general information purposes only.
Clients are advised to seek advice regarding their particular circumstances from their personal tax advisors.