Are we there yet?

A good question - Are we at the bottom?

Looking for the Bottom is a Holy Grail quest that will bamboozle investors without a long term strategic horizon.

Before the markets open today, just a word on market bottoms. 

Some of the most interesting questions in investing are especially appropriate today: “Since you expect more bad news and feel the markets may fall further, isn’t it premature to do any buying? Shouldn’t you wait for the bottom?”

To me, the answer is “no.” We never know when we’re at the bottom. We can pour over past stock charts, and there are a deep pit of these,  and we still will not know what will happen today in the markets. A bottom can only be recognized in retrospect: it was the day before the market started to go up. By definition, we can’t know today whether it’s been reached, since that’s a function of what will happen tomorrow. Thus, “I’m going to wait for the bottom” is an irrational statement.

If you want, you might choose to say, “I’m going to wait until the bottom has been passed and the market has started upward.” That’s more rational. However, number one, you’re saying you’re willing to miss the bottom. And number two, one of the reasons for a market to start to rise is that the sellers’ sense of urgency has abated, and along with it the selling pressure. 

That, in turn, means
 (a) the supply for sale shrinks and 
(b) the buyers’ very buying forces the market upward, as it’s now they who are highly motivated. 

These are the things that make markets rise. So if investors want to buy, they should buy on the way down. That’s when the sellers are feeling the most urgency and the buyers’ buying won’t arrest the downward cascade of security prices.

The old saying goes, “The perfect is the enemy of the good.” Likewise, waiting for the bottom can keep investors from making good purchases. The investor’s goal should be to make a large number of good buys, not just a few perfect ones. 

Follow on Twitter @JacolineLoewen

2 Changes to Estate and Tax Law in Ontario

The recent changes to Ontario estate law and U.S. tax law might impact families with wealth. These 2 new changes are worth reviewing:

1. For those of you with multiple wills (used commonly to avoid Probate) should review their Wills. A recent decision, Re Milne, rendered a Primary Will void because it contained a commonly used provision that gave the Trustee discretion to determine what assets to include in the Primary Estate. As a result, multiple wills are only valid if the assets that comprise each of the Primary and Secondary Estate are defined with sufficient certainty. This decision is currently applicable in Ontario, but it is possible that it could be applied in other provinces.
2.  U.S. citizens in Canada may be impacted by the changes to the Tax Cuts and Jobs Act, specifically the global intangible low-taxed income (GILTI) tax. U.S. GILTI tax is relevant for any U.S. Shareholder owning 10% or more of a controlled foreign corporation (i.e. a Canadian Corporation with US shareholder). U.S. Shareholders in that situation may have a one-time 15.5% tax, plus they must include in income such profits in excess of a 10% return annually on depreciable tangible assets owned by the corporation whether or not a distribution is made to the U.S. Shareholder.

 

Clients with wealth need to know you see their needs first

We are striving to talk to clients the way they think about their money, not the way we do. Many advisors jump into talking about themselves, how they have been doing their role for 20 years and so forth.  This does not give the client ease of mind.  The client wants to know that you see them and you understand their special circumstances, not that you are shoehorning them into a standard "solution".

Clients feel their money “has a job to do” – to help them develop and educate their children, care for their parents, fund their businesses and homes, spin out a monthly cash flow, etc. In our client relationships, we are focused on helping our clients achieve their desired outcomes – offering the right capabilities, removing complexity and truly listening.

Our clients have their best practices in managing their wealth. This mutual sharing of knowledge has developed the wealth management practices over the past 150 years and this is a responsibility we take very seriously.

How the developing world is shaking up tech from Mexico to Chile and Kenya

In New York with Wondereur for Fintech Finals

Fintech early stage companies were part of my company's Global Fintech challenge last year which I got to roll out and manage across Canada. What was surprising to our head office was the sheer number of good fintechs in Canada, not just Silicon Valley. That is what struck me as I read this article about how Silicon Valley and Canada are no longer the only place where fintechs are growing - Mexico with its lack of banking is shooting ahead with Fintechs too.

The magazine Unlimited has an interesting article on technological development outside of Silicon Valley and how fintech in the developing world is gaining traction.

I had been surprised last year, when the head of Blockchain in my company told me how Africa had played a huge role in developing blockchain as there were so few legacy banking systems in place. There you have it, straight from the horse's mouth about blockchain and developing countries technology sectors.

Here's the article...

Today earbuds can translate foreign languages in real time, while scientists are developing ‘living’ solar panels that can be printed on paper. Meanwhile, tech pioneers are setting their sights on still grander goals, like enhancing the human brain with implants raising the possibility of telepathic communication.

The pace of change in the sector continues to accelerate. In the US alone, the number of tech-related patents has doubled over the past decade.But, while expertise has been concentrated around California’s Silicon Valley, in the coming years technological disruption is increasingly likely to blossom in the developing world. Emerging markets are already undergoing a radical transformation. A decade ago the tech industry accounted for only 10% of the benchmark MSCI Emerging Markets index. Now that figure has nearly tripled to 29%, with four of the index’s five largest-capitalized companies coming from the tech sector. 

In China, the education system currently produces three million science and engineering graduates each year – five times that of the US – and the nation is already on the way to joining the long-standing tech leaders, Taiwan and Korea.In neighbouring India, already a global player in the IT services industry, the government now has the world’s largest biometric identification system, with fingerprints and iris scans of more than one billion residents. 

Yet, the technological shift is not being limited to Asia. Coordinated public and private efforts to foster tech start-ups in Chile have earned the country the “Chilecon Valley” moniker, drawing comparisons with the famous California innovation hub.Mexico has also made progress in promoting start-ups through the creation of the National Institute of Entrepreneurship, with similar programs running in Colombia and Peru, now beginning to trigger rapid start-up growth in cities like Bogotá, Medellín and Lima.Given the large population in Latin America who are without banking services, a key growth area is fintech. According to Finnovista, the number of fintech start-ups in the region recently surpassed 1,000.

Read the full article here.

Follow me on Twitter @jacolineloewen

You can read my author's profile on Amazon here.

How to Use Grief to Change the World

A father who lost his three daughters to Middle East violence has turned this tragedy into change for the region. Last night, I was part of The Daughters for Life Gala fund raiser which educates middle eastern girls here in Canada. The belief is that these women will change the region's attitudes to hatred and genders.

Jacoline Loewen, Daughters for Life Gala

What a steep hill Izzeldin Abuelaish has chosen to climb.
Izzeldin says it was the death of his daughters which pushed him to create change. The women at my table agreed that to push on after such a loss due to a bombing, was remarkable.
We then listened to the scholarship winners all in STEM studies at Canadian Universities. These young women travelled to Canada to go through university programs donated by Brock, Trent, Laurier and York. They each made us laugh, cry and understand that maybe, just maybe, this intervention would be a keystone to changing the whole Middle East.
I just know that if one of those girls was my daughter, I would be very proud of her. I also believe that each of these girls will indeed make a big difference.
Then Izzeldin gave Margaret Atwood a Lifetime Achievement award.  Margaret epitomizes what one woman can achieve. Her book The Handmaiden's Tale did inspire me to move beyond my original life goal to be a good wife and to get an MBA and get into the male area of business - finance.
Margaret Atwood's speech was a reminder of how far I personally have journeyed while reading her books all the way.

Daughters for Life Lifetime Award Recipient

When I - at first read Atwood - I did so reluctantly. Atwood was holding up a picture of Canadian society that I did not want to acknowledge. She also showed females in not always a positive light, showing our deepest fears and pain in our relationships. Such disappointments because of our place in society. She really spelt out for me that I needed to change and to take the harder road. I learnt through her novels how women needed to get their own income and it did inspire me to have a good career. Through out most of my adult life, Margaret has inspired me. My book club is currently reading Alias Grace and I look forward to our discussion, but my best book of hers is Oryx and Crake, a Booker Prize winner.
This evening, Margaret reminded us how far Canada has come in its gender roles. She told us that early in her career she was advised to stop her scribbling and find a good husband. She did not stop her scribbling and she did find a good man though - Graham Greene, her partner for decades. I am thankful she did find true love and she shared her views so bravely.

How can you grow your money?

How can you make money?

I suggest that you steal a page from the wealthy.

Business e-Volution, by Jacoline Loewen

The Spectrem Group found business owners account for 6% of seven-figure households — triple that of doctors and lawyers.

Don’t expect to get rich quick; the payoff comes when you sell. There is a great deal of that so-called sweat equity that is not seen or experienced by the average tax payer in Canada.

The median price for a web-design firm last year was $687,500, according to BizBuySell. I write about how to use the Internet to grow your business in my book, Business e-volution.

Construction firms tend to fetch $2.1 million. The bricks and mortor businesses still deliver a good return Not shabby amounts to add to your investment portfolio.

Calgary deals to be done at the Business Transition Forum

If you are seeking to speed up your opportunity to network with those interested in the sale of businesses, check out The Business Transition Forum. The next session is in Calgary on November 8th and then Vancouver on the following week.

Do you know the 3 Ways Retirement Planning is changing?

For "complete" retirement planning, there is more required than the usual "meat and potatoes" approach of financial preparation. Recent research shows that the retirement planning needs are changing.

Pre-retirees report that they are more anxious about the emotional adjustment to retirement than they are about financial security. Once over that barrier, the retirees worry about health and long-term care, and not so much about having income to sustain their lifestyle.

Our findings confirm that the wealthy investors are focused on:

1) Liquidity: Wealthy pre-retirees want to reach a certain asset or dollar level before they retire. In contrast, age is the retirement trigger for pre-retirees with fewer assets.

2) Longevity: More than half of wealthy retirees feel unprepared for health issues and long-term care. This is an opportunity for Financial Advisors to add far more value to their clients.

3) Legacy: 51% of retirees plan to leave assets to heirs and charity. As a result, many maintain and even increase equity holdings after retirement. Retirees in their eighties, for example, have equity levels similar to investors in their fifties.

Why Every Entrepreneur Needs a Mentor

Having just spent the past few weeks in the company of entrepreneurs, some at the beginning of their careers and most at the height of their success, I notice the one feature they have in common.  They have sought out a mentor.

Jacoline Loewen with Alumni of The Next 36

I was invited to The Next 36 reunion BBQ organized by Chenny Xia and caught up with the alumni who were mentored throughout their program. During our conversations, it struck me that as a result, these young women knew how to reach out for mentoring, they understood the high value of having a mentor and they knew it was not a waste of time but rather a way to catapult ahead. Kate Wallace talked about Facebook COO Sheryl Sandberg’s controversial book "Lean Forward".  Sandberg's written advice was her way of mentoring on a large scale and she dedicated a full chapter to mentorship. She lists Larry Summers as her most important mentor.
No matter their paths to success, accomplished women can usually agree on one thing: That somewhere along the way, they found a mentor (or more) who boosted their career immeasurably. "It was serendipitous that I met my mentor. I was searching for employment and what came of it was one of the most influential people in my life," said Danielle Smith, graduate of The Next 36 and mentee of Claudia Hepburn, who helped to found The Next 36.
Many famous people had mentors: Self-made billionaire, Oprah Winfrey was mentored by celebrated author and poet, the late Maya Angelou. Alexander the Great was mentored by Aristotle, Warren Buffet was mentored by Benjamin Graham, and Warren went on to mentor Bill Gates.
Of course, the best fiction has stories of mentorship; some of my favourites are Luke Skywalker learning The Force with Obi-Wan Kenobi, and Mary Poppins showing Jane and Michael Banks how to break all the rules. Instead of staying safely inside, Poppins had them dancing on the rooftops with chimney sweeps. As a young girl, I took in this encouragement to "Lean Forward" - aka the Mary Poppins way.
How Will You Reach Out for a Mentor?
If you have an early stage company, you could try Futurepreneur. Futurpreneur Canada and Spin Master Corp. set up the Spin Master Innovation Fund created by Ronnen Harrary; to bring financing, mentoring to 10 entrepreneurs each year. Over the past six years, the Spin Master Innovation Fund has helped 42 businesses launch.
For women: The WXNWisdom Top 100 Mentoring Program matches high-performing female leaders with influential mentors.
If you are a business founder who has achieved the sale of your company, you can get mentored about how to invest your sudden wealth. Smart entrepreneurs get that concentrating all of their money back into Canadian-based investments may be only one choice to build long term financial wealth.
If you would like to find out more about how Canadian entrepreneurs are investing with UBS Bank (Canada) please get in touch. I can discuss with you the results for the entrepreneurs who choose to manage their wealth with us.


Jacoline Loewen is director of business development of UBS Bank (Canada) and can be reched at jacoline.loewen at ubs.com  She is also author of Money Magnet: How to Attract Investors to Your Business. You can follow her on Twitter @jacolineloewen

Why Every Entrepreneur Needs a Mentor

Having just spent the past few weeks in the company of entrepreneurs, some at the beginning of their careers and most at the height of their success, I notice the one feature they have in common.  They have sought out a mentor.

Jacoline Loewen with Alumni of The Next 36

I was invited to The Next 36 reunion BBQ organized by Chenny Xia and caught up with the alumni who were mentored throughout their program. During our conversations, it struck me that as a result, these young women knew how to reach out for mentoring, they understood the high value of having a mentor and they knew it was not a waste of time but rather a way to catapult ahead. Kate Wallace talked about Facebook COO Sheryl Sandberg’s controversial book "Lean Forward".  Sandberg's written advice was her way of mentoring on a large scale and she dedicated a full chapter to mentorship. She lists Larry Summers as her most important mentor.
No matter their paths to success, accomplished women can usually agree on one thing: That somewhere along the way, they found a mentor (or more) who boosted their career immeasurably. "It was serendipitous that I met my mentor. I was searching for employment and what came of it was one of the most influential people in my life," said Danielle Smith, graduate of The Next 36 and mentee of Claudia Hepburn, who helped to found The Next 36.
Many famous people had mentors: Self-made billionaire, Oprah Winfrey was mentored by celebrated author and poet, the late Maya Angelou. Alexander the Great was mentored by Aristotle, Warren Buffet was mentored by Benjamin Graham, and Warren went on to mentor Bill Gates.
Of course, the best fiction has stories of mentorship; some of my favourites are Luke Skywalker learning The Force with Obi-Wan Kenobi, and Mary Poppins showing Jane and Michael Banks how to break all the rules. Instead of staying safely inside, Poppins had them dancing on the rooftops with chimney sweeps. As a young girl, I took in this encouragement to "Lean Forward" - aka the Mary Poppins way.
How Will You Reach Out for a Mentor?
If you have an early stage company, you could try Futurepreneur. Futurpreneur Canada and Spin Master Corp. set up the Spin Master Innovation Fund created by Ronnen Harrary; to bring financing, mentoring to 10 entrepreneurs each year. Over the past six years, the Spin Master Innovation Fund has helped 42 businesses launch.
For women: The WXNWisdom Top 100 Mentoring Program matches high-performing female leaders with influential mentors.
If you are a business founder who has achieved the sale of your company, you can get mentored about how to invest your sudden wealth. Smart entrepreneurs get that concentrating all of their money back into Canadian-based investments may be only one choice to build long term financial wealth.
If you would like to find out more about how Canadian entrepreneurs are investing with UBS Bank (Canada) please get in touch. I can discuss with you the results for the entrepreneurs who choose to manage their wealth with us.


Jacoline Loewen is director of business development of UBS Bank (Canada) and can be reched at jacoline.loewen at ubs.com  She is also author of Money Magnet: How to Attract Investors to Your Business. You can follow her on Twitter @jacolineloewen

35 ReasonsToronto Tech is Booming

 Invitation to UBS Bank (Canada), Wealth Management, Technology Invitation

WHY 35 REASONS?

In a stunning year for Canadians in the technology industry, 2015 brought many success stories.  

We thought we would add more spark to the tech industry this year by bringing together a room of 35 like-minded tech entrepreneurs and investors as guests of UBS Bank (Canada). 

Sure enough, the energy flowed.

OUR PARTNERS: 

We were delighted to partner on the Technology Networking Evening withPwC Technology and The Entrepreneurship Society, as well as Blake, Cassels and Graydon.

OUR GUEST SPEAKER:

A special thank you to Randall Howard, Verdexus portfolio investments, who stepped in as guest speaker when Drew Green, Indochino, was unable to attend. Randall  is a senior serial technology executive committed to building the leading technology firms in Canada. Randall shared several critical take-way point for the evening:

1. Focus: When Randall and the founding group of his succesful tech buddies donated a large sum of cash to get Communitech off the ground, they did not have any idea how big it would get. Randall said, "It took a group of committed individuals to make the technology industry thrive in Canada." 
2. Important Partners on the Journey: By coincidence, in the room was the investment banker who figured out a new financial structure to raise the capital for Randall's first tech company. The banker was a Waterloo engineering graduate too. There were many Waterloo graduates in the room. They certainly have figured out the secret sauce for producing winners. Randall emphasized how the profesionalism of the banker made the big difference in his career.
3. Giving back: Having reached the heights of success in his business life, Randall is now focussed on giving. He has won Angel Investor of the Year which really underlines how seriousy he takes helping the emerging Canadian entrepreneurs. Randall is particularly interested in social impact investing and along with his corporate and university board responsiblities, he sits on boards of arts and drama groups too. 

The Fourth Revolution: The theme of the evening was the next stage of techology. Julien Favre, UBS, shared with our guests the white paper on the theme of this year's World Economic Forum Annual Meeting in Davos, Switzerland, on January 20-23. The white paper is entitled Extreme automation and connectivity: The global, regional, and investment implications of the Fourth Industrial Revolution. It outlines:

• A brief history of the four industrial revolutions that have taken place since the late 18th century.
• It also explores the potential economic and investment consequences and likely regional winners and losers.
• If you also want to read the white paper - You can read the UBS White Paper HERE...

A special thank you to Sean Stanleigh, Julien Favre, Phaby Utomo, Matthias Kluser, Stephanie Baldouf, Quinn Lawson, Bill Hennessy, Ted Graham, Burzin Contractor and Andre Perey.

The democratizing of financial services

A few years ago, I began to hear about the democratization of investing into private equity.  It was recognized that the earnings can be significant. Allowing the grandmother investor, for example, to put money into privately owned companies in the same way the public stock market allows, will have a way to go.
Currently, one way that was created to allow the average joe to invest with minimal knowledge is by going into your bank and selecting mutual funds. They show up on your bank app and give a pretty reasonable return.
Using the TFSA account, the average person could also invest into a startup but maybe (probably) lose their investment as the risk is so high at such an early stage.
So although we do have some democratization of the investment opportunities, the Canadian retail banks do offer their mutual funds which are a great start, the fees are hidden and do take a significant chunk of the returns.
We will come back to mutual funds and other investments where you can get started. In the meantime, one of my favourite motivational coaches, Tony Robbins, has put out a book on Money. In it, one his themes was about - surprise - democratizing investments. I liked his message:

Think about the four main elements that impact our quality of life: our relationships, emotions, health, and money. The most difficult one for many people to manage—and a frequent source of widespread confusion and anxiety—is the money.

2015 is the year that will change.

The One Big Idea for 2015 is the democratization of financial services, which means that for the first time, everyone will have access to the unbiased advice and education they need to make confident, informed decisions about money and investing. Everyone will be able to find knowledge, tools and insights to help them achieve their financial goals.

The current financial system is opaque, complex, and designed to enrich and reward those on the inside. Average investors are so in the dark when it comes to the system that most don’t know just how much they don’t know.

For example: how is your financial advisor compensated? Do they have a legal duty to put your interests first, or are they primarily paid to distribute products? If you’re like most people, you don’t know.

How do you select a financial planner when you sell your business?

When you sell your company and all of a sudden, you have millions to invest, it can make you quite giddy. All of a sudden, your long last relatives will appear on your doorstep asking for a loan or an investment. Your niece will want you invest in her new app which is "brilliant".  Suddenly, you can access wealth manages who need you to have more than $2million to open an account. These wealth managers are the elite of financial planners.

Financial planners advise clients on how best to save, invest, and grow their money. They can help you tackle a specific financial goal—such as giving you a macro view of your money and the interplay of your various assets. Some specialize in retirement or estate planning, while some others consult on a range of financial matters. At the very least, they should find out about your family.

Don’t confuse planners with stockbrokers — the market mavens people call to trade stocks. 

Financial planners also differ from accountants who can help you lower your tax bill, insurance agents who might lure you in with complicated life insurance policies, or the person at your local bank urging you to buy their off the shelf mutual funds.

Anyone can hang out a shingle as a financial planner, but that doesn’t make that person an expert. They may tack on an alphabet soup of letters after their names, but CFA (short for certified financial planner) is the most significant credential. A CFA has passed a rigorous test on the specifics of personal finance. CFAs must also commit to continuing education on financial matters and ethics classes to maintain their designation. The CFP credential is a good sign that a prospective planner will give sound financial advice. Still, even those who pass the exam may come up short on skills and credibility. As with all things pertaining to your money, be meticulous in choosing the right planner.

Their firm is important. Some small planner make you pay dearly. They are smart but you end up paying more as they still have to place orders for your portfolio and they will have to pay a fee and pass that along to you. 

The new way of investors partnering with owners

Our research with the owners and CEOs of private companies and their private equity partners illustrates that there are three leverage points for investors to impact the trajectory of the business: 

1. Strategy and strategic contacts, 
2. People, and 
3. Execution. 

Loewen & Partners provides investors with a window of meaningful involvement in a portfolio company that goes far beyond the typical boardroom interaction. It allows a private equity partner to rapidly come up to speed on the key issues within the firm and help leverage the potential of the firm.

Click on who we are to get some background on our partners. To explore the RED™ process in detail, go to what we do.