Don't Be Emotional

'Don't be emotional when it comes to money' they say. I've read those words in every investment book and blog I've seen.

It means find the courage to do the opposite of what everyone else is doing and fly right into the fire. Turns out that it's really the only way you can 'buy low, sell high'.

Noreen Rasbach (Globe and Mail investment blogger) has thrown down the gauntlet this morning. She points out that the numbers are in and the supposedly long-term, stoic, emotionless mutual fund investors have been exposed as a bunch of pre-teen girls... they bailed and ran out on the latest market down-swing to the tune of $3.1 B (redemptions in Janaury). Many of these investors instead chose the money-market funds as a safe-haven alternative. Gee, could they all have met 10-15 year long-term goals already?

What's a newbie to do in the face of this kind of chicken-run?

I've got a load of RRSP's in hand, and I have absolutely got to invest them somewhere for growth. While the account my last year's RRSPs are sitting in currently pays 4%, I do not consider that sufficient to classify as 'growth'. This year's RRSP contribution will be locked in for 1 year at the slightly better rate of 4.3%. Good rates these days, but still not the 'growth' I am looking for.

So I believe the choices that stand before me are Index funds, Money Market funds, and Mutuals. I am leaning towards the mutuals Noreen... tally ho!