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Basic materials sector is having some money rotate into it. It’s the beginning of a new year where there is optimism and hope that the economy is going to heat up a little bit and maybe commodity prices have a bit of a lift. At this point there is not enough evidence to make a big allocation. This company is in the process of going through a change in the investor base.

He has more US bank exposure than Canadian because he thinks there is some pretty good value there and some improvements are taking place. This one is the cream of the crop with a valuation that would reflect that, trading at 1.8X book value. Bank of America (BAC-N) might be more interesting in the near-term, with the possibility of a dividend increase coming at the end of the quarter.

This is a bet that we may have seen the low in long-term interest rates last summer. This is showing in the way some of the life insurance companies have been behaving. Feels that this has some of the better fundamentals within the Canadian lifecos.

Toronto dominion (TD-T) or Telus (T-T) for a TFSA? Neither one of these is a bad bet. In the long run, this is the one that he would want to own. Has had a great run over the last couple of years and he thinks this is going to continue. They have been raising the dividend twice a year over the last 3 years, which they have committed to do publicly.

Toronto dominion (TD-T) or Telus (T-T) for a TFSA? Neither one of these is a bad bet. Telus is the one that he would want to own. This bank, in the short to intermediate term, will continue to do well. Banks in general will be long-term challenged as to where they get their growth. Their growth in retail banking in the US is positive.

Problem with aluminum is that there is never a tight supply. There is no shortage of raw materials so it is very hard for them to have pricing power. This company itself, sadly, has a history of disappointing when it comes to earnings. They are often the 1^st to report and often the 1^st to disappoint. Numbers really don’t show that things are getting a lot better in the near-term.

Facing a big uphill battle. On the mobile front Google (GOOG-Q) and Apple (AAPL-Q) are winning. Their tablet has been a little bit of a flop so far. Windows 8 operating system has been a little bit slower than people had hoped. Very little financial risk. Have a great balance sheet and lots of cash and you will pick up a nice dividend but it is a laggard stock.

At what time does a red flag go up when you are looking at a utility sector, regarding the PE multiples? What do you think of the utility sectors going forward? In the dividend camp, the utilities are probably going to be the most staid of the group. You are not looking for big upside. You are looking for some appreciation and your dividend yield. It may well be that dividend payers continue to be expensive on a relative basis if the alternatives of government bonds or term deposits don’t cut it for investors.

(A Top Pick Jan 5/12. Up 4.69%.) Had big exposure to midstream energy assets. US dividend payers pulled back in November with concerns around changes in tax policies, so he switched his focus more to Canadian names.

(A Top Pick Jan 5/12. Up 1.41%.) He has a pretty good exposure to Pharma groups. Starts with a basket of them and then works into the strongest positions. Sold this one. This group looks like it has broken out of a 12-13 year base and likely could trade higher from here over the next 2-3 years.

(A Top Pick Jan 5/12. Up 11.21%.) Had a 1 for 3 spinoff into 2 separate companies. He bought this leading up to the spinoff which worked out well for him. Started to see some pullbacks in the markets in October November so he stepped out of this.

He would avoid this one. It is one of those oil/gas positions that has been a weak performer. A lot of people like to buy it for the yield but he doesn’t like laggards. 8% yield.

This one has been basing on the price chart for the last little while. Market seems to be hardening up a little bit for pulp prices. Thinks this one can probably go higher over the next couple of months. Wouldn’t be hard to see $13-$14 on this.

Some of the mortgage REITs in the US have had a tougher time recently because, in effect, the Feds purchasing program of mortgage backs is squeezing out the mortgage REITs. Good business model. Doesn’t think rates are going to shoot higher in the near-term.

If the market hangs together here and works its way higher, driven by some of the liquidity in the market, then the Canadian banks are going to perform just fine. Dividends are going to continue to get paid and continue to grow, albeit it will be slower than has been historically. Thinks the long-term theme in this market is dividend growth and you will get a more significant total return if you can pick up the yield plus you get some growth in the capital value. In the last 15 years, financials have been big winners. Feels that the long-term secular growth rate in North America is going to be better found in energy infrastructure.