A Comment -- General Comments From an Expert (A Commentary)

ETF Tracking Errors: He is not fussed about tracking errors. He feels it all comes out in the wash – over time. If you are consistently lower than the benchmark then you could consider getting out.

ETF Balancing problem: This applies to leveraged and should be held 6 days max. He doesn’t recommend leveraged ETFs. The rest can be held for the long term.

The big theme in the gold sector is consolidation. Focuses on smaller companies that might be take-over targets.

He is bullish on Uranium in the 3-5 year time-frame. The bull market cracked because of investor expectations.

People are tired of getting no interest on their savings. Not excited about bonds. So they are buying stocks. Sept and Oct are supposed to be scary months but haven’t been. Markets have gone up for 4 months and at some time there has to be a correction. Stay short in bond durations. He is very cautious about going out beyond 4 years.

Silver: Thinks it is overvalued. There is a huge production in the world. But people think there should be a ratio between gold and silver. Thinks it is ripe for a pullback.

A little weary of where we are. Globally we are at our near term highs. Except in Canada where gold might go a little higher. You need to pare back those ears of the portfolio that have grown out of proportion. The economy really needs support in the US. He has been taking some profits.

Silver. Probably tied to gold, which has gone up too fast in too short a time. One thing silver has that gold doesn't is that it is consumed because of industrial purposes. Believes in its strength because of the industrial component. Look for companies that have not followed the commodity.

Canadian Natural Rsrcs (CNQ-T) or Suncor (SU-T)? Likes and owns them both but probably prefers CNQ a little more at these levels. Has more diversification in its operations.

NAV Canada Bonds. Basically an infrastructure play. Very good structure. Fairly low yield but very dependable and a good bond. AA

5- Year Quebec Hydro strip bond. Hasn't benefited from the real interest rate move that has happened in the 30-year or 10-year. Over time, it should do fine.

Real Return Bonds. Real yields are in a bubble so these are not attractive right now. There are better assets for an inflation-adjusted return.

30-Year Canada bond yielding 5%. Because of its duration, it will have a lot of exposure to interest rate moves i.e., a lot of risk. Expects interest rates have put in a bottom and inflation expectations picking up in the short-term.

Today’s Market Call was pre-empted for live coverage of Federal Finance Minister Jim Flaherty’s Fall Economic Update.

He is looking for a very short term set back after the recent rally. He is optimistic going into the end of the year. The major impetus for growth will come from developing nations. Thinks the fed will do more quantitative easing, but he questions how much good it will do. Stocks will go higher after the US election on Nov 2.