It’s a Sunday afternoon, and you are thinking about your savings and investments. As you peruse your mutual funds listed in the paper, happy with your purchases, you come across an article in the Business section listing the “Top Ten Funds of 2005”. Suddenly you feel uneasy. You don’t own one of the suggested names. Should you be worried? - Probably not.

We are inundated with financial planning information on a daily basis. What’s hot, what’s not, how to get rich quick and how to time the market are all common themes for business journalists to write about. Let us introduce you to a slang term - “Financial Pornography” – which is used to describe these hordes of articles, news stories, and advertisements touting the latest investment trends.

Financial porn is especially dangerous if it leads to action. Consider, for example, the devastation of the tech-boom. The media was overwhelmed with stories on how tech stocks were going to make you rich. Many investors rushed to purchase those stocks just as the bubble was about to burst. We know what happened after that. More often than not, by the time these stories are written, it’s already too late. The top ten funds of 2005 were probably the best performers of 2004 and may have already reached their peak.

So what can you do to avoid being swayed? For starters, take everything you read with a grain of salt. Sensationalized information is written more to keep the reader interested and to sell copies of the publication than to provide sound investment advice.

Secondly, though it can be difficult, try to separate your emotions from your investments. Irrational decisions based on fear or greed can only hurt you and your plans for the future.

Finally, talk to your financial planner. These professionals know what information is credible, and what’s not. They will be able to steer you clear of any misguidance caused by financial porn. And likely, they will recommend that you “stay the course” – invest for the long-term. If you are properly allocated to your risk tolerance, you won’t have to worry about the hot new funds. This will allow you to take financial porn for what it is – entertainment.

This is a monthly article on financial planning. Call or write to Rick Sutherland CLU, CFP, FDS, R.F.P., of Fundex Investments with your topics of interest at 798-2421 or E-mail at rick@invested-interest.ca.