Microsoft's 2Q profit falls 28%

Microsoft Corp. said Thursday its fiscal second-quarter profit fell 28 per cent, as delays from the launch of its new version of Windows cut into holiday-quarter revenue.

For the three months ended Dec. 31, earnings fell to $2.63 billion, or 26 cents per share, from $3.65 billion, or 34 cents per share during the same period last year.

Analysts polled by Thomson Financial expected the Redmond, Wash.-based software maker to post a profit of 23 cents per share.

Revenue rose to $12.54 billion from $11.84 billion in the year-ago quarter. Results were higher than Wall Street's average forecast for $12.08 billion in sales.

On investment risk

A prudent investor's best safeguard against risk is not retreat, but diversification

- David Harding, Windo Capital

How to review you investment portfolio (Part 2)

Form Investor Insights by TD Waterhouse

Performance

1. Are my targets realistic?
2. Are returns adequate? Even if they hit your targets, you need to make sure returns are sufficient to fund your future plans. If your portfolio isn't growing quickly enough to meet goals such as retirement, it may be time to make changes. Pay attention to longer-term performance, rather than short-term. Short-term volatility in your portfolio means little when you have a long-term horizon.
3. How is my portfolio performing compared with markets? Compare percentage returns with appropriate financial market indexes.
4. Am I within my risk tolerance? Taking on more risk is a way to increase potential returns, particularly through growth investments such as stocks. But it also increase your potential for losses. Know how much risk you're willing to take and check regularly to see whether your current risk level is acceptable.
5. Am I taking full advantage of my RSP? One of the best ways to reduce taxes is by making the maximum allowable contribution to your RSP every year.

How to review you investment portfolio (Part 1)

From Investor Insight by TD Waterhouse:

Financial markets change, and so do you. That's why it's always a good idea to review your investment portfolio regularly...

Your investment objectives

1. Are my goals reasonable? You can't meet impossible financial goals.
2. How quickly must my money grow? Look at how far you've come, and how far you have to go. Adjust your performance objectives if necessary. But keep them real and within your risk tolerance.
3. Am I investing enough?
4. Has my live changed? Has anything vital changed in your life that calls for an adjustment of your financial objectives or investment strategy? What about major developments, such as marriage or divorce, the birth of a child, or a change on employment?

Asset allocation

1. Is my portfolio adequately diversified? Do your investments include cash, fixed income, and equity investments in a mix that is suitable for current market conditions and your risk tolerance?
2. Do I need to rebalance? If certain investments have appreciated in value, they may now represent a disproportionate amount of your portfolio. It may be time to lock in profits and reinvest in more attractively priced securities.
3. Should I change my focus? Generally speaking, the older you are, the greater the need to be aware of the risk and potential of loss of capital. After all your time to replenish lost capital diminishes as the years pass...
4. Is my portfolio tax-efficient? Properly allocating investments among your Retirement Savings Plan(RSP) and non-registered investments can reduce income tax. Consider holding interest-generation investments, such as bonds and bond mutual funds, insider a RSP, where the income generated is tax-deferred. Equity investments may be more suitable outside your retirement plan because the dividends and capital gains they generate receive favorable tax treatment.