r liquidity purposes, if you are wealthy and risk tolerant you may choice to have about 5% of your portfolio in cash, this does mean that the cash component will never rise above 5% due to the market cycle. Whereas those who are risk adverse may choice to have 10% or more in cash. Taxation - The level of taxation will determine the choices that are made in regards to the choice of tax advantaged securities such as some limited partnerships as well as the choice of tax deferral plans. Market timing – Your investment strategy could include the buy and hold approach or the market timing approach of investment. Buy and hold means long holding periods through various market cycles for long-term growth and income. Market timing involves timing the short term entry and exit points in the market in pursuit of quick trading, gains over and above the commissions incurred.There are some other reasons why a portfolio foundation objective maybe determined. They could include the desire to retire at a certain age, acquisition of a business, a vacation property, or the pursuit of some other tangible goal.Constraint Objectives: The constraints provide boundaries that may hinder or prevent you from satisfying your foundation or major objectives. Legal – Any investment activity which disregards any act, by-law, regulation, rule or the criminal code must be considered a constraint. For example if your not married you are restricted from participating in a spousal RRSP and therefore from its benefits of income splitting. Moral/Ethical – When considering investment activities, your research should include whether the company that you are investing in follows your moral guidelines. For example, if you have personal convictions against alcohol or tobacco usage, then you would not invest in these securities. Basic Minimum Income – Your portfolio should be structured to generate a good total ...
