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

The Reddit short squeeze: with markets you always see new things. Unpredictable. After a week, the element of surprise is gone, but it's possible this could happen later to other stocks though the effect will be weaker. People who bought may be in a losing position now. Wider markets could be choppy this month, given investor sentiment being overblow in January. Now, that sentiment is peeling back. Also, February tends to be seasonally weaker. So, he's raised some cash and is putting it to work on down days.

Market. He is worried things are looking toppy and we are in a bubble of some sort. After stocks go public, the stock goes way up before the money is even spent. When you look back to 2001, not all stocks got hit. A lot of the rest of the area other than Nortel was not hit that hard. There are pockets of the market where you will be okay. He is optimistic that the vaccines will come into greater use and the pandemic will come under control. The trajectory for stocks over the next few years will be higher. There are going to be corrections along the way, but you have to stay invested in stocks.

Silver. It is still trading at a discount to gold, relatively. There is still industrial applications. He would hang on even though we had a big move up. He would take silver over gold at this point.

Rising margin debt. Every major market peak we have had, there is an element of speculation. You can't time these things however. You are seeing the froth and the leverage coming through margin accounts. It speaks to the expansion of credit margins and the quality of the value is entirely speculative. The rally we are seeing is not on fundamentals.

Silver. There was a natural opportunity in the short for GME and other stocks like this. However for silver, the market is massive so the dynamics are very different. Redditors will have a difficult time pushing this higher probably.

The caller asked whether money managers can use ETFs to beat indexes. There is always the option to go with actively managed ETFs that try to beat the index. The other aspect is asset allocation. ETFs allow money managers to move easily between stocks and bonds instead of liquidating and buying numerous equities. This makes it easier to change allocations and maximize returns.

Canadian dollar. If the constraint of oil supply gets squeezed, we can see the Canadian dollar higher. Fair value is around 75 cents but it is obviously higher right now.

Educational Segment. Looking at moving averages and market breadth. It's important to look at how many stocks are participating in the rally. Market breadth is telling us what the current quality is like. Looking at the moving averages within the S&P 500, we are seeing a pullback coming soon. However, when is the important question. We are seeing market breadth lessening and so this indicates retracement. This week, if the S&P 500 does not close above the 50 day moving average, then it will be closer to the 200 day average. Don't chase the bounce today.

Risk vs. reward during Covid short-selling craze: does this mean a new risk to markets? Ask, is it systemic risk or any other risk? He isn't worried; we can handle with this rationally.... Semiconductor shortage: he had no idea it was coming. A buy during volatile times....Other opportunities lie in tech like Facebook and Etsy...The reopening trade: Disney and Boeing. The latter didn't go down despite a bad quarter....Other bullish themes during volatility: cybersecurity, 5G (Qualcomm), China (don't play it through commodities, but buy Apple, Nike), healthcare (Eli Lilly, Teledoc), e-cars (GM on weakness), housing (Home Depot), clean energy (Plug).

Market outlook. The vaccines are coming slower than we would like. It is a persistent virus but it is a natural event. In terms of the Reddit frenzy, we have seen this before but not to the same extent. He got lucky and sold into this rally for BB. Robinhood had to suspend to ensure solvency. Buyer beware when the market itself is threatened.

Robinhood. People are engaged now and after 2008, there was virtually no retail investors. They are slowly coming back, and more liquidity is a good thing. Democratization of ideas is also a good thing. The market mechanism is to find truth. Stories can persist for a while but it will reflect the truth eventually. Hopefully people won't be burnt too badly.

What's trends are catching your eye? Condo market is quite different than publicly traded real estate. CAR, for example, is focused on the upper tier suburban market that isn't competing with condo rents. Condo rents are being affected by a shutdown in population growth. Return of immigration and foreign students will make a big difference to the condo market downtown. In the meantime, apartment REITs such as CAR are well positioned.

What about retail trends? Retail properties need to reinvent themselves, and this will take a lot of capital. First quarter will be choppy. More store closures than last year. He's staying away from retail. Winners continue to be logistics and industrial warehouse real estate. There's growth there. Consumer hasn't stopped shopping; they're just shopping differently.