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

Park money for 3 to 4 months. This is always a challenge. The general idea is that one is not getting enough safe return. If your horizon is 3-4 months, then you can't get into equities. There are high income savings ETFs that have emerged. CSAV, PSA and HISA. They focus on high income savings. You get over 2% interest today. ZST gives you a money market kind of holding.

Put Spread. You buy a put and write a put. You reduce the cost of the downside protection. He would look at doing this. A long put offsets a short put.

US security ETFs clearing in New York or in Toronto yet securities may not be located in the city it trades in. You can buy them in both places and it may impact tax consequences.

In the last 10 years US markets have lead the world recovery. We are at that point where the US is so expensive relative to other places in the world that we will start to see conversion to the US doing less well and international markets doing a bit better.

He has a problem recommending ETFs with leverage in them to an average investor.

His favourite way to play international markets is via a covered call, high divined stock strategy.

Educational Segment. Looking back on the last year. He thought we would get a bear market over this year but it was a brief but deep pull back last December. He said then and still thinks we will not see it in terms of job losses until well into 2020. He said then, and still believes, that the trend of a declining Canadian dollar will continue into 2020 somewhere below $0.70. The Canadian banks may not correct until well into next year. He thinks interest rates will be lower in a year than they are today.

Market. It looks like we are seeing a bit of re-acceleration in some of the global numbers he is looking at. One thing he is excited about is some of the changes in technical top down indicators. He is starting to see improvements one after another in many global markets around the world. Lots of stocks are moving higher, not just a few. The number of stocks in an uptrend is broadening out. There has been a fair amount of tax loss selling in the energy sector but there are pockets that look like they are ready to re-accelerate. In the cannabis sector he has started to see some interesting technical indicators changing and it looks like the Canopy stock may be turning the corner and ready to accelerate as well.

Gold. In some cases it would make sense for smaller companies to merge. The gold price has gone up over the year so now there is more focus on gold. Now you are seeing some mergers are being announced. Junior explorers and producers are now starting to move. The price of gold will depend on inflation, which he thinks will flare up a little. It will be fairly lumpy.

He's bullish, certainly more so in the past few months as interest rates worldwide have eased. You have to look a year ahead, but also don't sell stocks on headline news, like tariffs. Focus on the fundamentals. He holds 15-20 names. When their fundamentals change, then he makes a move. keep defensive names; interest rates will remain low or go lower. He's still avoiding resource stocks, though they aren't a bad trade now; they're cheap and you can move them.

Market Outlook The latest jobs release in the US is bringing a rally. It has been a volatile week. He thinks the market will rally into the end of the month. There are still several black swan issues out there, particularly regarding trade issues with the US and the impeachment process. The Canadian dollar is off over a half percent today, but he does not think this is a new trend. He thinks the CAD will stay between $0.75-$0.76. A new Bank of Canada leader is expected to be relatively seamless, he thinks. He believes, Tech stocks should encompass the classes of digitalization, autonomous driving, 5G, gaming, hardware, data analytics, AI, software, and Fintech.

There’s no question that the job data from the US was great. Above expectations. Revisions were positive. In Canada, the compilation is a bit suspect, but overall it was weaker and this leads to weaker GDP numbers. Looks like we’re fading a bit since the beginning of the year.

Oil is coming back up as Saudi’s try to keep a base in price for the IPO of Aramco. Holding the WTI around $60. The energy sector looks to be oversold so it could be a good time to enter there.

Market. There is a bull market in the US currency. He sees the US dollar way outperforming any other currency. Going forward we only need a couple of pieces of good news and it will take off. After five years of negative yields in Europe, the whole banking sector is putting that into effect. It is a mess. Japan is a tough spot to be. The US dollar is the place to be going forward. All assets priced in US dollars will do very well. There is a countdown for the recession. Once the US dollar starts to go up it suck up funds from all over the world. The US market may 'melt up'. Canada is setting up to be the laggard. If the TSX doubled it would still be a laggard in the world.

Tonight's show was a repeat program from the Wednesday, December 4 MCT.