Andrew Pink

Expects more volatility. We're jumping from data point to data point. Every time something's announced, the markets take that as an indicator of what's next to come. This morning we got ADP numbers from the US at 497K, with the estimate being 225K, wildly higher. This number measures the private sector estimate of job growth in the US.

These things create volatility, and that's what we're seeing in markets. The broad market TSX index is up 3-5% YTD, and the S&P's up 15%. These numbers don't really tell the whole story, as we have some really high flyers in both the TSX and the S&P. SHOP is up around 78% YTD, CSU is up in the 40% range. Then you have NVDA and TSLA in the US that are really driving a big part of those returns. Underneath that, you have a broad market that's really quite volatile.

We'll continue to see volatility until we get some clarity from the Fed and other central banks on interest rates. 

He ratcheted up his fixed income, and is staying short duration, but hasn't moved a lot in there. If the inflation numbers start to trend down below 3%, the Fed will be reasonably satisfied with that. This is going to take time to churn through. We just have to wait and see how the economy reacts to 5.5% overnight lending rates. 

Consumers seem to be very resilient on spending, but that's going to wear thin in time. That's when we're going to feel more comfortable, when the Fed and other central banks see an end to the hiking cycle.

He got it a bit wrong too. He anticipated China to come back much earlier, and clearly that hasn't happened. Still thinks it's possible. China's cut interest rates and there are other measures to come to stimulate that economy. They do need to stimulate the economy, which would in turn drive the resource-centric Canadian economy.

Likes it. It's an inflation story. Some consumers are gravitating away from restaurants and back to buying their own food, so it's a volume story too. Good place to be. Trading at a reasonable 15x earnings, not overly expensive. If you think we're getting into a mild recession, which might be prolonged, this is a safe bet.

Supply chain logistics and tracking solutions. Global, large. Owns a lot of IP, able to leverage it globally. Good story. Really consistent operators. No dividend.

Will continue to do well. Growing really fast. Hit an EPS growth target of 15% every year for the last decade. Really likes the story.

Preferred share market has been under a lot of pressure, very volatile. Tends to trade with the broad markets. When there's tension in the broad markets, the reaction of preferred shares is heavier because it's a thin market. Retail investors unloading at tax-loss selling season can drive real price dysfunction in that market, which is unfortunate.

The market's only going to get smaller, as a number of the big banks have redeemed their preferreds and are shifting over to hybrids and other methods of funding. You can get a fixed rate or a floating rate (rate reset) type. He likes rate resets when rates are going higher, as the preferred shares will reset to a spread above the BOC rate. 

From this level, we could see a little bit of capital appreciation. It really depends on the type you have, and you have to really be aware of the different features of each.

Likes the pipelines, but he prefers ENB. Cost overruns on Coastal GasLink. Keystone is a big question mark, not sure if it's going through next year or not. Trading around 16x. Yield is 6.7%. 

His preference in the pipeline space. Recovered from 2 of its 3 issues, expects #3 to be resolved as well. Trading at 14.2x. Better value and fewer variables than with TRP. Yield is 7.2%.

Bit more volatile than the rest of the group. Quite good dividend yield of 6.5%, raised it 3% last quarter, doesn't see it being cut. Larger international segment, which can create volatility, especially in earnings. Big change in leadership. Worried about its losing senior management. Not sure of strategic direction. Reasonable valuation, below peers.

He's in base metals, but not this one. Merger situation creates less clarity. He owns FCX to get copper exposure. The story is really all about China, whether they come back, and how fast. Small dividend yield of less than 1%.

He's in base metals, a timely play. Big US player. His play to get copper exposure. The story is really all about China, whether they come back, and how fast. 

He'd say we're going to get a re-steepening. His feeling is that the long end of the yield curve is actually going to shift higher, flattening out on the short side. That's where your risk is buying long bonds. Maybe not so much on the GOC or provincial side, but on the corporate side. 

Corporate side you get the impact potentially of re-steepening, which increases rates but decreases price. You could also get the impact of spreads widening.

His philosophy has been to stay short-duration bonds, of 1-3 years, and to wait out those maturities. On some corporates you can lock in 6.5%, government's are closer to low 5's. It's a reasonable place to hide out. If we see a recession, we could see a re-steepening at that point.

At the time it was a safe haven during the pandemic. A short-duration trade. Once the markets took off, he moved into equities.

Really likes this whole segment of e-commerce and logistics. A very clear winner in the space. Lots of acquisitions. Buys intellectual property, brings it in-house, rebrands and sells it. Cross-selling opportunities are pretty phenomenal.