Stock markets posted another week of gains as equity exuberance kept investors on a buying spree. The big U.S. stock indexes, especially, floated to new record highs last week. Toronto’s benchmark S&P/TSX Composite Index continued to rally from a mid-April low.

For many do-it-yourself investors, actively managed mutual funds are considered to be a sucker’s bet. Many believe that they offer nothing more than poor investment returns and high fees. Their rationale is that you can simply go out and buy a low-cost index fund or ETF that will provide the same investment exposure at a much lower cost. Sure, you won’t ever beat the index, but you also aren’t expected to underperform by much more than the MER. And yet, some actively managed funds do manage to outperform. How do you separate the wheat from the chaff?

As they come closer to retirement, some investors decide that they are too old to assume any investment risk. That attitude is often abetted by advisors who recommend that they move a larger part of their investments from stocks to bonds and other fixed-return investments. But does this strategy make sense in today’s interest rate environment?

As investors, we find ourselves working with a playbook where old rules no longer apply. It appears that global growth – anemic as it is – is being propped up by government stimulus that focuses on domestic economies. Out of necessity, that may be an appropriate strategy, but it is artificial and in the longer term will weigh on global growth and probably delay any potential recovery. For investors, that has implications for finding the best asset allocation strategy in an increasingly darkening investment environment.

Stock markets recovered from a hoax Tweet on Tuesday to post weekly gains despite a retreat in commodities, more signs of slowdown in China, and slower-than-expected growth in U.S. first-quarter economic output.

Fund company: Dynamic Funds
Fund type: Canadian Small/Mid Cap Equity
FundGrade® Rating: C
Style: Blend
Risk level: Medium
Load status: Optional
RRSP/RRIF suitability: Good
TFSA suitability: Good
Manager: Oscar Belaiche since August 2002; Jason Gibbs since March 2007
MER: 2.75%
Code: DYN 087 (front-end)
Minimum investment: $500

The price of gold plunged early this week in a bout of selling spurred by news that China’s economic growth had slowed in the fourth quarter and reports that a large unidentified player had entered a sell order for 400 tonnes – a huge amount even by central bank standards. The action hit already-stressed gold mining companies, like Barrick Gold Corp. (TSX: ABX), hard, resulting in a -10% loss on the week for the S&P/TSX Global Gold Index. The materials, metals and mining, base metals, and energy indexes all suffered commensurately as investor sentiment generally continued to sour on commodities.

Month after month, the Investment Funds Institute of Canada (IFIC) releases its monthly sales statistics, and each month, without fail, fixed-income funds continue to see big inflows of new money while equity funds see net outflows. According to IFIC, in 2012, bond funds saw more than $19 billion of new money while investors pulled more than $14 billion from equity funds. While equity funds are now seeing renewed inflow, bond funds are still taking the lion’s share. In March 2013, bond funds took in $855 million, while equity funds attracted $341 million. Given the current fixed-income environment, this trend causes us great concern.

Most of us want to invest some money to supplement other retirement income streams that include Canada Pension Plan, Old Age Security, and perhaps an employment pension plan if you are lucky enough to work with an organization that provides one. What are the options and which is the best for your circumstances? Which one works best for you depends on your particular situation (age, income, goals, among others). In this article, I’ll take a look at the most popular options available to Canadians.

The S&P/TSX Composite Index slipped into a year-to-date loss at the end of last week’s close as investors reacted to negative news on U.S. consumer sentiment and retail sales, as well as tumbling gold and oil prices. U.S. indexes, meanwhile, dipped a little on Friday, but ended with decent weekly gains.