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

Oscillator. If you are going to use this, use weekly or monthly charts, not daily. Use 5 weeks minus 15 weeks smoothed by 3. That works the best.

Asset allocation. There are 10 specific S&P sectors. You should own at least 5 distinct separate sectors and no more than a third in any one sector. He would vote for being overweight on Materials and Industrials, Telecom, a little bit of Consumer and would probably pick away at financials but be light on them.

POT is one of the companies he has been asked about on the shows. If you look at the numbers, the debt load, price of potash, he questions the valuation on it. Yet it is based on what people will pay. Both BHP and POT have large debt loads. Interest rates have only one way to go – up. He bought VT. Balance sheets are always critical to contrarians.

Banks: Don’t buy into them now in Canada, but in the states.

Market Timing: He believes in it but takes a lot of bumps because of it. He wants to buy in when the market gets hit, say couple hundred points in a day.

Oil. Believes in peak oil theory but currently sees oil being range bound between $65-$85 in the short term. Energy and energy consumption is predicated upon global growth and currently there is a lacklustre period of global growth.

Identifying Value companies. Looks for companies with 1) low price earnings multiples 2) low cash flow multiples 3) discount to book or NAV 4) tax loss carry forwards 5) assets.

Global corporate bond funds? Corporate bonds have had a great run and you want to stay with them. Still the most attractive part of the bond market.

Term deposits give you very limited returns. You may have to get out of your comfort zone and at least Buy GIC's and perhaps form a ladder or alternatively a government bond ladder.

Canada Housing Trust bonds? These are fully guaranteed by the government of Canada. If you are a “Buy and Hold” investor, you want to have some money in these.

Real Return Bonds as a long-term hold over 20 years? He would recommend a minimum of 5% in your portfolio. This is the only perfect guarantee you have in Canada of getting some absolute real return on your money.

(A Top Pick June 24/09. Up 11.35%.) City of Toronto 4.95% due June 27/18. Still likes.

Bank of Montreal or Commerce? Which dividend would have the most upside? Feels Bank of Montreal is a better run bank so this is the one he would prefer.

Lots of news. Fed didn’t move on interest rates. Fed is telling market that they are paying attention. Unemployment situation is not getting any better. They are providing liquidity to the markets. They are concerned about a double dip recession. This was comforting to investors. The second half of the recovery will be a lot slower than the first. He is seeing reasonable valuations in Canada. Corporate earnings are coming in much better than expected. Canadian Market is flat year to date, yet dividends are being increased, etc. Fixed income pays almost nothing. Although defensive, commodities are starting to look very attractive.

Good dividend stocks? If you want growth, Crescent Point (CPG-T) is good. BCE (BCE-T), Brookfield Properties (BPO-T), Enbridge (ENB-T) and Telus (T-T) all look pretty good.