May 2010



	May, 2010		Volume 3, Issue 5
	In This Issue	*MFG FINANCIAL DISPATCH* A Monthly Publication of MacIntosh Financial Group Ltd. Celebrating 25 Years of Serving Our Clients
● ● ●	Win One of Two $25 Starbucks Cards Investment Basics - Equities Bits and Pieces	Win One of Two $25 Starbucks Cards Once again we’re giving away a $25 Starbucks card to each of two lucky people this month. If you would like to be one of our winners, simply click on the word “WIN”, and answer the four multiple choice questions based on information in the articles in this newsletter. We’ll randomly draw two names from the correct entries and award a card to each of those two people. Last month’s winners were Lindsie Seed and Kevin Hull. Congratulations to you both. This month’s draw will happen on May 28^th. All the best!
		Investment Basics - Equities Back in the Middle Ages, being “in stocks” was an unpleasant, humiliating experience. Although it has a totally different meaning today, being in stocks can still at times be an unpleasant and humiliating experience. It can also be very rewarding and play an important role in a long-term financial plan. We’re going to briefly review what stocks or equities are, how they work, what their advantages are and what their risks and limitations can be. With investing, the words "stocks", "equities" and "shares" are generally interchangeable and mean the same thing – ownership in a company. Most people invest in equities by buying units in equity mutual funds. If you invest in an equity mutual fund, you indirectly own common stocks or shares in public corporations. The mutual fund is a shareholder in these companies and shares in the profits and losses of the company. If the business prospers, common shareholders may receive dividends, or make capital gains if their shares are sold at a profit. If the business performs poorly, and their shares are sold at a loss or if the business fails, common shareholders could potentially lose some or all of their investment. For a long term investment, there are some real advantages to owning common shares: Capital Appreciation Capital appreciation happens when there’s an increase in the share price. The price of shares is determined by the law of supply and demand - if many people want to buy a stock, the price goes up. In the long term demand is usually based on the value that people see in the company issuing the shares, taking into consideration current profits and/or potential future profits. Current market sentiment will often have a big impact on demand in the shorter term causing shares of companies to rise or fall regardless of the perceived value of the individual company. If you sell stocks or shares in a public company or equity mutual fund at a profit, you will earn capital gains. Capital gains have preferential tax treatment over interest income. Only one half of the gain is taxable. Dividends Common stock dividends may be paid by a company if there are profits left after paying expenses. The board of directors determines the dividend policy and some companies pay a specific dividend each year while others prefer to reinvest all the profits into growing the business. The dividends received from common share ownership also have preferential tax treatment over interest income. Voting Rights Voting is a right that is conferred on some, but not all, common shares. If you invest in a mutual fund that in turn buys voting shares of a company, the mutual fund exercises those voting rights for you. Risks and Limitations Stock investment, whether direct or through an equity mutual fund, is not at all for the short term. As we have seen vividly over the past couple of years, the values can fluctuate drastically in the short term. If you needed to sell all or a large portion of your investments at just the wrong time, the results could be devastating to your financial plan. These investments should be viewed as long term, generally between seven and ten years. Even then there is no guarantee of a positive return – just the potential. Equities are also not the only type of investment you should hold in your portfolio. This is particularly true as you draw closer to the time in which you will begin depending on your investments for income. Equity ownership is just one type of investment but because of its potential for long term growth it’s an important type that should be included in the portfolios of most people. If you have questions or would like more information about investing in equities, please contact us.
		Bits and Pieces Manulife AIC Mutual Funds As we reported in our August, 2009 MFG Financial Dispatch, Manulife Mutual Funds (Elliott & Page) purchased AIC Mutual Funds. Since that time, Manulife has been transitioning the AIC funds into their family of funds. This process is nearing completion and as of June 7^th all AIC fund accounts will be transferred into Manulife accounts. If you own any AIC funds, your account may be assigned a new number. The mutual fund code will also be changed but the fund name will remain the same. Other than that, there will be no changes. Quote: "We simply attempt to be fearful when others are greedy and to be greedy only when others are fearful." – Renowned investor, Warren Buffett In 2010 we are celebrating our 25^th Anniversary of serving our clients. For 25 years we have been providing financial advice and products to some of the finest people we know. We really do appreciate you and we look forward to continuing to serve you for many years to come!
		MFG Financial Dispatch is our monthly email newsletter designed to keep you up to date on timely financial issues that may affect you and to pass on timeless information and advice regarding financial issues. Archived issues are available in the Client Centre on our website (macintoshfinancial.com). If at anytime you would prefer not to receive these communications, please reply to the email with “Unsubscribe” in the subject line and you won’t receive another one. Our website address is macintoshfinancial.com . If you are on your smart phone you can also find our contact information on our “.Tel” page at macintoshfinancial.tel. Follow us on Twitter - *MacIntoshGroup*