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

Market. [Larry's Market Comment was pre-empted by Remembrance Day Coverage.]

Where to park cash when out of the market. He would want to put his money in a US$ money market strategy. Note that the markets could keep going up for 2 or 3 years.

Educational Segment. He thinks interest rates will continue to go lower. When we get to a recession, the best asset class to own is longer term fixed income – the US treasury market. He thinks the US 10 year will go to yielding close to zero during the next recession so owning it now will be a good investment. There is so much debt in the world that we can't see interest rates going up because we can't afford it.

Market. He is watching the American NAHB Housing Market Index. Global PMI numbers were contracting for 6 months in a row yet the home building numbers are at 20 month highs. You rarely have a recession when the home building industry is doing well. Lumber prices are picking up. Consumer spending south of the boarder is at a 6 year low but optimism is at a 19 year high. This is a conflict. The federal reserve is cutting rates and yet the unemployment rates are at 50 year lows. There are plummeting bond yield. Investors should take a shallow recession into account.

Gold. How to preserve wealth in times of high inflation when you can't buy bullion in your registered account. Stocks in general are a hedge against inflation. The best stocks are companies that have exposure to hard assets. BAM.A-T is an example.

If you want to work with a financial planner, you have to do some work like looking at your finances in greater detail and not missing anything....For six months, he expects markets to do well till the end of the year. But we're in the middle of the longest-running bull market and stocks are expensive. He's worried. He doubts that stocks will rise much from here nor for much longer.

How often are the holdings in active ETFs rebalanced? Are they cheaper than a mutual fund? It depends on the ETF manager and the nature of the fund, like whether it's a covered call one. Read the ETF prospectus to see how often they re-balance. ETFs are cheaper than mutual funds. However, ask whether you need an actively managed ETF or not. Is it worth the extra money? Usually not.

Where to put cash? He's fully invested, but look at mutual funds and ETFs, like Dynamic Funds'. Also look at ZST.L, which he'll talk about later. Even put cash in a high-interest daily interest savings account, but you'll be lucky to get more than 2%.

Is creating a trust better than directly transferring wealth to children? A trust is good if there's a lot of money/assets to be safely and carefully moved to children. Also, a trust will ensure that children are not irresponsible with their inherited money because an adult is watching over that money, and ensures that the wealth is dispersed according to the deceased's wishes.

How to rebalance 10 dividend growth and growth stocks as a 26-year-old investor? He's misguided. Don't look at dividends, but total returns, at age 26. Too young. Berkshire Hathaway pays no dividend, because it is concerned solely on growth. DRIPs, if you're worried about being too concentrated, then turn off the DRIP and invest those dividends elsewhere.

Market Outlook He thinks that sometime before the next Presidential election there will be a US-China trade deal. He is interested in what he sees as the market moving away from momentum into value stocks -- financials and industrials. Markets outside of the US are improving, including Europe, emerging markets and Canada. He sees valuations in Europe and Japan now being of much better value -- stocks in the US are not cheap. It may be time for more active management, as the US indices may not reflect what is going on globally. He has deployed some of his cash holdings recently and is looking to buy value when the opportunity presents itself.

Gold miners? You only want to own commodities when their price is doing well. Gold prices are doing well. The problem with miners is that share prices get separated from the commodity prices at times. There are always operational issues. He prefers holding Franco-Nevada as it is a royalty structure and not dependent on a single mine. He thinks gold prices are in a corrective phase, but poised to go higher.

Record highs in the S&P500. TSX is also very close to hitting all time highs. People are buying because markets are going up. There are some concerns that the markets are going to fall down again. However, the breakout we’ve seen this month is distinctive as we are breaking above new levels.

Half of the gain this year is a recovery from last year. We’re up 2-4% annualized, depending on which market you look at, so there is still lots of volatility.

Right now, compared to 2 years ago, it’s been steady so you definitely have to trade to get good performance.