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

Canadian telecoms. Telecoms comprise an oligopoly in Canada and are difficult to displace. Solid, long-term assets. Raise dividends over time. Compounders of value and cashflow. Put it in your portfolio and forget about it. When you look at these stocks, don't wear the glasses you use to look at growth stocks, but use the right glasses: boring, but profitable over time.

His 2021 outlook is bright, because vaccines will be rolled out in first-half 2021, and because of cheap money (low interest rates). He sees a rotation in the no-tech sectors including mining and financials. IN recent years, US stocks have driven world markets, and in that basically a handful of mega FAANG names. Going ahead, he sees wider sector and country participation. 2021 will be the year. Vaccines won't go perfectly smoothly, given unpredictable human behaviour and possible side effects. The JNJ vaccine would be announced until January and, if it works, is positive news. Altogether, these vaccines will get the working population going.

An ETF to earn high interest If you hold cash and can't take any capital loss or have a short time horizon, do not buy any ETF. No ETF will pay you higher interest than where your cash sits now (i.e. bank account), because the MER and market fluctuations down won't make it worth buying.

The market rolled over as Doordash IPO'd today. He likes Doordash, but the valuation is crazy. He thinks the stock is worth $100 given competition and lack of profitability. Today's buyers paid 13x sales at over $180/share. Tomorrow could be worse when Airbnb IPOs and push markets down again (as buyers sell their other stocks). Doordash buying actually sagged today until the last minutes when it rebounded. At least today's market declines helps to clear this frothy market.

Based on analyst Larry Williams' true seasonal index Williams says we are currently in consolidation until mid-next-week. Then, starting Dec. 16 the markets were rally, then go into overdrive a few days before Christmas, staying through the end of 2020 and ending in the first week of January.

We're seeing a ever-broader market rally due to stimulus and vaccines driving optimism. The outlook for 2021 looks positive, given vaccines and pent-up demand driving economic expansion. Cannabis: the US market will be 10 times larger than Canada's, but in the U.S. several states have limited licenses, which has created mini-monopolies within those states. Now, we're seeing a huge ramp up in EBITDA. In the U.S. there's a huge opportunity in cannabis for years to come. Growth rates look attractive. Telemedicine: this and e-health will extend beyond Covid. Perhaps people will do their first appointment online with a doctor before seeing him in person. Also, people are more focused on their health given the virus.

Stimulus. We probably won't get a massive spending bill like what the Democrats were hoping for. Democrats are really hoping to swing the senate in Georgia in January which could help them get more stimulus. Very much a political hot potato. How the Feds and Central Bank will monetize the debt is also a key point to watch.

Senate. Markets would like having Democrats in the senate for the stimulus. However, markets like checks and balances. If central banks pull back, markets will have a difficult time.

Leverage. He would not be using leverage to play equity markets. Things have reflated to valuations so you want to be defensive. Banks are okay but we are in a low rate interest rate environment. There will be little growth.

Educational Segment. When investors are bullish in markets, they are buying calls to participate in the upside. When there is an expectation of down-side, they buy puts. Looking at the markets, there is more buying of calls near highs and puts near lows. We are now seeing in the put-to-call ratio, we are at the 90th percentile. We are at an extreme point here. This tends to mean a 5-10% correction soon.

Market. November was a strong month. We are finally seeing a much broader strength in the market. It looks positive going into 2021. We are stretched a little at these levels short term, however. Any pullbacks will be pretty good buying opportunities during December. He thinks we will see a weaker US dollar going into 2021. Global growth looks positive as we go into a post-COVID world.

Best Canadian Telecom. He has no exposure to them, having transitioned out over the last couple of months. BCE-T would be his favorite. For dividend investors they are a nice part of the portfolio.

Telehealth Stocks. He is more familiar with Cloud MD. The adoption was always something you could see but the pandemic has brought that forward. It is definitely an area of healthcare that is interesting. There is definitely upside to the sector as a whole. It is hard to know which company is going to do the best so own small positions in two or three of them.

How to Buy Volatility. Over the last ten years the VIX has moved higher at the same time as the market sells off. It still has not been below 20 since March and we saw a significant run in stocks. Volatility is up at the same time as markets and this does not happen often. The traditional correlation is breaking down. It feels like we are in the beginning of the market top blowing off. Prepare to be in an environment where we still have an elevated VIX.