Educational Segment | StockChase
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Compiling comments that experts make about stocks while on public TV.

Educational Segment

Date Expert Opinion Subject
2017-06-26 Larry Berman CFA, CMT, CTA

Educational Segment.  Robots.   A lot of boring jobs were replaced by computers and so a lot of jobs have gone away.  Amazon is breaking every space.  They could have cost a million jobs by now.  They are only going to get bigger and bigger in this space.  He feels there will be social problems coming.  From the mid-70s to today, the bottom 50% of people have seen no real growth in their incomes.  The next 40% have seen only a marginal growth.  The top 10% are all doing well.  BOTZ-Q and ROBO-Q are ETFs for robots and they have outperformed the world.  He will love them once we get a market correction.

NORTH AMERICAN - LARGE & ETFs
2017-06-12 Larry Berman CFA, CMT, CTA

Educational Segment.  The US Yield Curve.  There have been three rate hikes: Dec/15, Dec/16 and then Mar/17.  The yield curve is the difference between the two year rate and the 10 year rate in the US.  We have seen a flattening of the curve following each rate hike.  Short term rates are rising while long term rates are falling somewhat.  This historically means that the market is anticipating a slowdown in the economy.  He would be shocked if we did not get a rate hike this week, but that should be it for this year.  Longer term rates will continue to fall.

NORTH AMERICAN - LARGE & ETFs
2017-06-05 Larry Berman CFA, CMT, CTA

Educational Segment.  Chart shown of Market Capitalization of the MSCI world metals and mining index vs. capitalization of GOOGL.  GOOGL is now worth more than the base metals sector of the entire world.  The metals and mining index has been coming down with a lot of it being the Chinese growth story tailing off.  Chinese growth is 100% fueled by Chinese debt.  China is the real catalyst for the next global downturn.  He has been watching Dim Sum Bonds.  It is the worst performing bond index in the world.

NORTH AMERICAN - LARGE & ETFs
2017-06-05 Larry Berman CFA, CMT, CTA

See his educational segment.  The bump we saw in China is over.  China will grow at a much lower rate than the last couple of years.  He is playing SLX-N as the best infrastructure play as it is steel in the US.

NORTH AMERICAN - LARGE & ETFs
2017-06-05 Larry Berman CFA, CMT, CTA

See his educational segment.  It is not a good buy.  The bump we saw in China is over.  China will grow at a much lower rate than the last couple of years.  He is playing SLX-N as the best infrastructure play as it is steel in the US.

NORTH AMERICAN - LARGE & ETFs
2017-05-29 Adam Thomas

Educational Segment.  Demographics. You have two natural drivers of growth:  Growth from population growth and growth from productivity growth.  From the sum of the two we get about 1.3% growth in the world.  We have a growth problem, despite all the money being spent in the world.  We are in a low growth world.  The vast majority of the growth in the world is from China, India and Africa.  But China is near finished growing.  AFK-N and INDA-N are ETFs he likes.  Buy on pullbacks.

AGRICULTURE, DIVIDEND & FIXED INCOME
2017-05-15 Larry Berman CFA, CMT, CTA

Educational Segment. He gets a lot of questions on hedging, and this is to show you his favourite indicators, and what are quite popular on the street for figuring out where the Cdn$ might go. A upper part of the chart showed the traded value of the Cdn$ over a two-year span. When it was going up, it indicated the dollar was weakening. The bottom part showed the interest rate differential 2-year US and 2-year Canada. As the differential was rising, the spread to US interest rates, the US yields more than Canada. Money tends to flow towards the higher yielding currency on average. With that in mind, the Fed is likely going to keep raising rates, which is a bit of a negative. However, compared to where the spread was when we were back at the extremes, we are now at the same level spread wise. The chart also showed the correlation of oil to the Cdn$, which pretty much followed. The chart also showed the speculative position in the futures market. Currently, we are at the highest level in terms of net speculative Shorts in the last couple of weeks. That tells him that there is an imbalance in the market. The loonie might be close to a bottom for at least the next 6-12 months. Going out to the end of 2020 on the futures curve on a crude oil chart, we are looking at pretty stable oil prices in and around $50 looking out 4 years.

STOCKS & ETFs
2017-05-08 Larry Berman CFA, CMT, CTA

Educational Segment.  When you invest globally, currency is the most important consideration.  It makes a huge difference to your return.  He showed a chart of long term returns of international ETFs with and without currency hedges.  Currency explains about 70% of the difference in returns.  It is the biggest factor over the years.  This is not the best time to get into Europe except with a currency hedged, covered call ETF.

NORTH AMERICAN - LARGE & ETFs
2017-05-01 Larry Berman CFA, CMT, CTA

Educational Segment.  The Fed in their meeting will debate this week how to reduce the debt. He thinks we are in a liquidity trap.  He does not think we can get back to 3% growth and they can’t raise interest rates much.  Looking at quarterly GDP going back 20 years, the chart has been falling constantly for decades.  The 34 quarters since the Lehman moment have seen us running at 1.5%.  Interest rates first fell dramatically in 2000.  The fed is thinking 3% is what we can get back to.  He does not think so.  The US yield curve 10 years compared to 2 years.  The curve is not saying there will be a recession.  Since they started raising rates the curve has been flattening, so the economy is not handling it.  Look at the fed balance sheet.  It has been flat since QE3 ended in 2014.  The annual GDP was last growing without deficits in 2000.  So the economy is very, very weak. 

NORTH AMERICAN - LARGE & ETFs
2017-04-24 Larry Berman CFA, CMT, CTA

Educational Segment.  US Government Shutdowns.  Valuations are high and this is a ‘risk-off’.  You want to be defensive if you can.  There have been 22 government shutdowns in history.  The most recent two had a small impact on GDP (0.1%).  The market historically gets nervous before a shut down and then is fine afterwards.  From a markets point of view it is a case of buying dips.

NORTH AMERICAN - LARGE & ETFs
2017-04-17 Larry Berman CFA, CMT, CTA

Educational Segment.  Hedging the Canadian Dollar.  Currency explains about 70% of the difference in returns between markets.  In Canada, the US$ is key.  Currency differences are caused by imports, exports and interest rate differentials.  We are range bound to 70-80 cents for the next few years.  You want to hedge when the Canadian dollar is at the low end of the scale (.73 or below).

NORTH AMERICAN - LARGE & ETFs
2017-04-10 Larry Berman CFA, CMT, CTA

Educational Segment.  Why Long Bonds are the Best Way to Diversify your Portfolio.  You have to look at risk and return.  Long bonds have the same or less risk as equities.  You get a better yield from long bonds than from equities based on risk.  Long bonds are the most negatively correlated to equities.

NORTH AMERICAN - LARGE & ETFs
2017-04-03 Larry Berman CFA, CMT, CTA

Educational Segment.  The French election is coming up at the end of April and is not priced into the markets.  There were two elections last year that did not go the way the pollsters predicted.  This is a market risk.  VT-N dropped as we got into the US election last year.  It went 5% below peak.  The Brexit decline was similar.  If we go to an Anti EU government in France it will be very negative for the markets.  ZWE-T is the way to play this.  He buys into dips, but is underweight.  If it gets back down to $19.40 you should get back into it.

NORTH AMERICAN - LARGE & ETFs
2017-03-27 Larry Berman CFA, CMT, CTA

Educational Segment.  It is the 10th year anniversary of the show.  He often gets the comment that he is always bearish.  But he thinks he is optimistic.  He looks at the risk side before the returns side of investing.  Beta is the sensitivity to the market risk.  When he is considering buying anything he thinks about the risk index.  ZEB-T graph compared to the world index looked at the weekly return and then he finds the trend.  The slope of .65 tells him the sensitivity to the world index.  At this level about 50% is related to sector risk.  He decides how much of the decision relates to the world, or to sector or to the specific stock.  XEG-T is the Canadian energy sector, compared to the world it is more sloped, meaning it is more risky.  He needs to weigh the macro factors more in this case.  SU-T has a lower correlation to the energy sector because there is less risk and that is because of their refining business.  Energy is starting to look interesting now.

NORTH AMERICAN - LARGE & ETFs
2017-03-20 Larry Berman CFA, CMT, CTA

Educational Segment: Long-Term Investing. This is on geopolitical and global macro, because a lot of global hedge funds macro views and look for themes in markets. This week, Canada has their budget. Global investors look at things like this and look for what is diverging and what is different, and is it good or bad compared to others. The US is cutting taxes, both corporate and personal, while Canada is raising taxes. Global money follows the flow of funds. Canada has net outflows on capital account, net outflows on current account, so we run trade deficits. There is less money coming into Canada so the global investors see that Canada is vulnerable and if they Short Canada as well as the currency, will the Bank of Canada raise rates? Investing in Canada has a lot to do with oil, and as oil goes, so goes the TSX.

If the budget is as bad as he thinks it is going to be, in terms of taxing capital and savings, you use inverse ETF’s. HBP 60 Inverse ETF (HIX-T) is an inverse play on the TSX 60. While Canada is somewhat cheap this year, it is only going to grow at 1.5% a year over the next 5 years, and only because they are borrowing money.

STOCKS & ETFs
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