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

You can still get into REITs despite this year's run-up. Valuations are still good and REITs offer a total return including dividends that compare well to fixed income. REITs have held up in the past year during three market sell-offs. We're not out of the woods in the world economy, and he expects a slowdown and choppiness. Also, pension funds invest in REITs to meet their long-term returns (they no longer achieve that with bonds); so they are moving into REITs and will continue to.

Market Outlook He thinks a melt-up will follow an announcement of a trade deal between China and the US, but most is already factored into the market. He thinks there is 6-7% of upside in the market next year. We may not get a pullback in the market until the US Primaries -- around March. Brexit, interest rates, and earnings have already been taken into account by the market. The Chinese want a trade deal passed, although it may roll into January should not derail the Santa Claus rally. He is not entirely in on the all risks off trading strategy and is using a barbell strategy that includes real assets (RA.UN) like infrastructure and real estate paying a 5% dividend yield.

The NASDAQ index is rising much quicker than the S&P500. The charts look similar to the 90s Dotcom Bubble. The yield curve is flattening out, suggesting slow growth. He would recommend taking some profits off the table if you own tech stocks or ETFs. In 2000, there were 85% loss in the NASDAQ.

NASDAQ 100. Cisco hit a high of 85$ a share and it never made it back. Microsoft took until 2017 to break even. It's not about how much you make on the upside, but how little you lose in the downside. The further you fall, the more you have to move up. The US economy is growing at 2.5% and high valuations don't make sense. Now is the time to prepare against downside.

Payment Companies. Owns Mastercard. A great story. Some countries like Italy are only 25% electronic payments. The world is going electronic and he believes some time in the future we will see cash disappear from the system. These companies have a long runway, all of them. Owns Mastercard, but thinks Paypal, VISA etc. are all going to do well.

5G Companies. 5G is still 2-3 years away. The installation part of the play is still to be made. Qualcomm, Ericsson, Nokia. Huawei is a market leader. Owns Broadcom (AVGO-Q) which is one of the largest chip maker and very diversified.

Market. Fears of an economic slowdown are easing. Record territory on the TSX and in a lot of markets around the world. The cyclical part maybe not doing well but not scaring people. Growth sectors continue to do well. Thinks the background is favorable for stock investing in the next 12 months. Thinks there is some upside in the FANG stocks with the higher growth. Sees solid 5-10% growth for the next 3 years in the markets. Recently published a report on Asia on their website. Sees upside in e-commerce.

How long can the bull run in US stocks continue? Things can last longer than you think they can. US economy continues to extend and lead the global economy forward. Plus monetary loosening from the Fed is the key to the latest spurt in the market.

How do you reconcile the Canadian economy with that of the US? US is consumer-led, and the consumer is in great shape so they're starting to ramp up spending. Whereas Canada is a trade economy, so the trade war has hurt us. Pipelines are not being built, and we depend on oil as our biggest export, so that's hurt our economy.

How will markets react next week to President Trump's bill supporting Hong Kong protestors? Doesn't give much credence to what comes from Trump. He does a lot of sabre-rattling, and runs international trade the way he ran his own companies. Trade friction has hurt underlying business confidence.

How do headlines affect your stock picking? He's a fundamentalist, so he gives a business a valuation and focuses on that. Tries to ignore the politics, though it is distracting. Short-term, it can really move the markets. Over time, western demoncracy has been relatively consistent in its free market approach.

Where to deploy cash right now? He runs a fundamental, go anywhere portfolio. Invests mainly in North America. Only invests internationally if it's an industry leader in a particular sector. The momentum trade will break sometime in the next year. Forgotten areas of the market which pose tremendous opportunities include energy. Energy consumption continues to increase every year, and oil should stabilize.

Is the new federal cabinet more western Canada friendly? Alberta is hurting. Oil is the biggest export this country has. Hopefully Trans Mountain expansion gets done. The federal government needs to support that industry, and it hasn't.

Canadian banks. Canadian banks have done well over the last 10 years. Stats show that Canadians are living on the edge, and bankruptcies may go up if there's a downturn. Banks are still safe, but you don't want to be overweight. Wouldn't hurt to take some profit, as there's some risk right now.

Market Outlook Many of the REITs out there have narrowed their discount towards their NAV. He sees power demographic factors fueling the apartment sector -- young professionals, many without cars, students, seniors and immigrants are all stimulating demand. There is a shortage of single family lots for new development.