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

Copper names. Likes commodities and the cyclical space. Lots of analysts and firms are ratcheting up expectations of a decade or more of commodity firmness. An ETF would make sense, like COPX. Includes BHP, FCX, TECK.B, and Glencore. Geographic allocation is 30% Canada, 8% Japan, remaining in the rest of the world. Levered to expanding global economy. 65 bps MER. From a technical perspective, likes FCX.

Dipping an investing toe outside Canada and US. A lot of investors are heavily weighted in Canada and the US, without looking beyond those borders. Europe offers a lot of value now, and the EMs offer quite a bit of growth. EEM will get you into China and Hong Kong, etc, with some tech names. Concern about EMs is whether vaccines are flowing as quickly as in developed markets. Looking at Europe, try FEZ, a very simple ETF that holds 50 of the largest names, all blue chip, lots of value compared to the US, yield is about 3-4%.

REIT space. He doesn't own a lot of REITs, other than SPG. But in the warehousing space, the first name that comes to mind is PLD, in industrial storage space. He doesn't own it, but would consider it more for growth instead of yield.

Pace of price increases uncomfortably high for a while? Yes, but he's also in the camp that thinks inflation will be transitory, as in "non permanent". Inflation will be meaningfully above-target until the back half of this year. See his firm's article "Death, taxes, and inflation". At the end of the day, Fed will fulfill its mandate. He's positioning for some interest rate increases this year, though not enough to take us to a restrictive stance on monetary policy.

Promising sectors. Cyclicals poised to continue to perform well, and that means banks, insurance, energy, basic materials, but not to the exclusion of the secular growth areas like his core holdings in technology and emerging growth. Energy and financials should continue to show leadership in the market and above-trend growth in earnings. Starting to see emergence of value over growth, but not enough yet to put an all-in bet on one or the other. His strategy is to own the best in each category of growth and value.

Add a 4th Canadian bank? If you have 3 banks already, you probably have enough exposure to the sector, depending what the weights are. In some industries, the idiosyncratic differences between companies is dominant. In others, the broad macro story drives the returns through the whole sector, and this applies to banking. The core weighting will drive your results more than which one you pick. Which isn't to say that you shouldn't pick the best.

Utilities. Long-term, bright future for power producers. We're going to have a greener electric grid and vehicle fleet, and we're going to need clean power to support that transition. Lots of capital will be deployed. Most utilities are regulated, which adds up to earnings growth for the sector and, by extension, dividend growth. Short-term, rising interest rates are a mild negative. Thinking of utilities as bond proxies is outdated. Multiple compression represents a buying opportunity for the decade of growth ahead of them.

Talked about his book coming out entitled 'Bull Shift', bull meaning market that's rising and shift meaning diversion of attention. Financial Services Industry tends to divert attention to the optimistic side of things but we need to be aware of potential problems in today's market. Advisors should be alerting clients to these problems. Markets today are especially worrisome since they have been high for some time. He has been expecting a pullback for some time and believes that it will happen when rate hikes actually happen. Is advising clients to consider emerging markets and gold. Also products that pay a regular income but not necessarily part of the market.

Has just put together a structured product related to inverse participation in the S&P 500. It goes up when the market goes down and down when the market goes up. This would be as a hedge against a coming pullback which he thinks will be more in the U.S. since the market is higher there.

Caller asked about Canadian banks. He considers them very resilient and able to provide a steady and growing income stream. Maybe they won't do astonishingly well but are good long term. Not as worried about them as he is about other areas.

Question was Ultra Pro (PRO). Didn't have enough info. Not sure but probably an inverse product, therefore for trading not long term.

Question on housing. Rate hikes will affect housing. We are in an 'everything bubble'. Feds have had our backs for 21 months and when they start to normalize this will mean concern for the markets.

Question on inverse ETF's. 'Trend is your friend'. These are trading products. Markets go up and down daily and you have to reset every night.

Question on a new ETF product called SHE. This is in the gender diversity area and holds companies with more gender diversity which have been shown to do significantly better. It is a niche product. He likes it - hold to a maximum of 5%. It's overdue and will continue to be proven.