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

Can we paint too rosy a picture in light of huge government deficits? Taxes can be an issue. But if the economy can grow out of the past recession, we can handle the deficits. US stimulus plan allows the world's largest economy to get going. Increasing numbers of vaccinations will help global economies open up.

The reflation trade. Financials, including banks and insurers, on both sides of the border make a lot of sense. Move away from tech into sectors like financials, industrials, and materials. Some areas, especially tech, are being driven by momentum and bordering on speculation at this point.

Healthcare names. Likes the healthcare space with names like AbbVie, Teladoc, and UnitedHealth in his portfolio. Teladoc has done well, despite its volatility.

Jitters in tech stocks over last few sessions. Not just tech. There's volatility everywhere. There's the global reflation trade. But you also have the stay at home trade, which boosted the tech side, but now you have the return to normal. Money being taken off the table from tech and put into cyclicals like financials, energy, industrials, materials. The Fed is caught between a rock and a hard place. If bond yields continue to rise in response to stimulus and trying to protect jobs, the Fed might be forced to tighten policy too quickly. But a complacent stance could cause overheating risks. Important catalysts coming up: US fiscal bill, JNJ emergency doses being added to supply. All creating unpredictability. He's sitting fully invested across 29 tech vendors and end users. He also has a 62% short equity hedge, which has been coming down.

Why is AAPL down 5% in a week? It was up 85% last year, so there's nothing wrong with taking profits and recycling them into cyclicals. Same with GOOGL and Salesforce. It's not as though people are becoming bearish on these types of stocks.

Electric battery companies. A complicated area. There are EVs, battery companies, the supply chain behind all that, and the whole charging side which is very interesting. Best to do some research. His analysts have just completed some.

To young people, there's a better way to manage your money, instead of being hooked on the Reddit/Robinhood squeeze trade. He's talking about the GameStop surge at the end of today. This isn't a team sport. This squeeze is highly risky. Instead, try long-term investing through fractional shares in Lam Research, Netflix, Tesla and others.

The ending of lockdowns and increasing vaccinations (ex-Canada) around the world: It is exciting the markets: earnings estimates are climbing and thrilling consumer stocks (cruiselines, airlines seeing increased booking for the second half of 2021). This excitement is weeks away for Canadians. The reopening is a good thing and it's coming. He maintains a barbell approach in his investing: he holds growth in communications, tech and global brand companies (i.e. Nike); and he also holds cyclicals to receive dividends. It's time for a pause in the recent climb in the US 10-year yield; we're now touching a ceiling of 1.4%. This run-up has caused some inflation scare in the market and caused cyclicals (energy and financials) to rally, but has tossed the best-quality growth stocks to the side. Without global monetary stimulus, we would have had higher interest rates. Powell is speaking now, and he vows to keep rates low and perhaps allow inflation to rise a little higher to encourage fuller employment. This will help earnings. Gold and stocks have been a good hedge against inflation; over time, inflation leads to higher earnings which lift share prices.

Canadian bank outlook He likes the Canadian banks here. Mid-2020 he added to them, hopeful about vaccines which would open the economy. Maybe he was a little early, but banks are now doing well. The equity markets are performing now. Banks are breaking out now and he'd buy. BMO just put out a great quarter. These are dividend payers and are long-term investments, not for day trading. Always good for income and growth.

Market outlook. Powell has justified valuation of equities with low interest rates. Now that rates are picking up, it will be interesting to see what he says about inflation and what the Feds are going to do. Technology particularly has been inflated due to low interest rates. The yield is going up to around 1.5%. Oil prices are also expected to go up.

Educational Segment. PRO-Eyes index is something he has created. It has 20 different factors with 4 valuation factors. The index shows you when there is opportunity or when to be cautious. The index is currently telling us we are at the high end of the market and caution is warranted. There is a high probability of a 5-10% correction in the next few months. The index is updated weekly on the Berman's Call website.

Market. She aims to participate in what is working in the market. You saw these massive rotations last year. Investors shifted where they were willing to take risk from valuation risk to earnings risk. There is a lot of interest in names coming off cyclical bottoms. The market has been driven by early recovery stories. She looks at stocks on a case by case basis. Some lumber names will do well and some tech names won't. Companies that rely on acquisition for growth, are having to pay higher and higher multiples.

Electric Vehicle Infrastructure. This is a huge secular theme in the markets. It is a place where a lot of capital has been flowing. MG-T is one of her top holdings.

5G – How to play. Some of the semi conductor names are a way to play it and particularly KEYS-N. We are still in the very early stages of that build-out.