How to profit from major economic trends

Trend 1 - interest rate start rising
lock in debt before rates move higher. If you have stock portfolio or equity mutual funds, take some profilts, as rising interest rates are usually bad news for stocks. Those with interest bearing investments should keep rolling their money in liquid 20-90 day deposits or money market funds. consider to sell bond.

Trend 2 - interest rate are droping
This is a good time to have a floating rate mortgage and consumer debt. Falling rates usually signal the beginning of a new upswing in the stock market. Start looking at buying undervalued shares or adding to an qwuity fund. Before rates drop, investors with a primary focus on fixed income should purchase bonds or other interest bearing investments with as long a term as they feel comfortable, to lock in the higher interest rates.

Trend 3 - Inflation rates are rising
Higher interest rates often accompany higher inflation numbers. In this situation, you generally want to avoid stocks and not lock in money into interest bearing investments for the longer term. Hard assets such as real estate, precious metal and commodities like oil, base metal and forest products, generally perform spectacularly in a higher inflation env.

Trend 4 - Inflation rate are dropped
Selectively buy stocks or equity funds. Lock in interest bearing investments at these higher interest rate. seel hard assets. People with personal debt should keep it at a floating rate. Wait until inflation falls and interest rate drop before locking into a longer term.

Trend 5 - Canadian dollar is rising against major foreign currencires
It means more profit for the importer and its stock.

Trend 6 - Canadian dollar is falling against major foreign currencies
It means more profit for the exporter, importer should be sold or avoided.