Latest Stock Buy or Sell? Make More Informed Decisions!

If you are in a decent market and have stocks that are not participating, then perhaps you should move on. They are running into operational troubles so you should move on and look at something else. The stock looks broken.

You are trying to pick a bottom here. but he thinks this sector will be weak for some time. This one will not bounce back to $100. They don’t have the same tail wind they used to have. Take a look at some other sectors that do have a tailwind.

US$. He thinks the appreciation will continue on for years to come. The Canadian dollar is not appreciating against world currencies as quickly as the US.

REITs. A lot of people are worried about rising interest rates, but he thinks it is not likely to happen any time soon. This sector looks interesting. This has been an underperformer. Prefers GRT.UN-T.

US Healthcare Sector. The biggest industry in the US. He would pick JNJ-N. PFE-N is good also.

There was a lot of regulation coming out of the recession. MS-N is moving rapidly towards asset management (55% of revenue). It is a stable business where they deal with a very high end client. Thinks their dividend could go up 100-150% over the next year. Believes investors will be prepared to pay a higher multiple as they recognize that risk levels have come down due to new regulations.

The consumer has more money in their pockets now. EA-Q has a broad range of customers from young to old. They will now spend more money in gaming. Now more and more sales are being done online so that a retailer is being cut out. The customers are repeat customers, constantly upgrading their games. Their business model is changing and their margins are going higher.

One of the first places people spend money when they have more. They are opening a new theme park in China. Their media businesses are doing well. Strong balance sheet and they are likely to win in a better environment.

3% dividend, likely to have accelerated dividend growth going forward, strong balance sheet, and very little commercial risk. US financials are likely to have a tailwind going forward.

Economy. It is generally conceded that next year we will still see global growth pretty sluggish and tepid. This makes it more important for investors to keep their costs low. If Real Return is fairly constant (Real Return is the return above inflation) and inflation is very low, then right away the nominal return is low. If we have tepid growth, then returns might be even lower still. We have muted growth and very little inflation, so the total return for the equity markets might be mid-single digits for the next little while. If that’s the case and you are using a traditional mutual fund where you are paying a 2.5%, that is half your return. Whatever you can do to in reduce your costs is really important. That includes the cost for advice you are getting. People who have a 7 digit portfolio should be paying less than 1% for advice.

A fairly new US healthcare hedged back to Canadian dollars. This is a good way to get exposure to the sector.

2015 Investing Resolutions.

1. Keep track of your household net worth (total assets -total liabilities) annually - it should be growing.
2. Resolve to cut costs in 2015; financial advice for a 7 digit portfolio should cost >1%, IMO.
3. Trade less. Research has shown repeatedly that trading correlates negatively to performance.
4. Do all tax loss selling and make all charitable contributions before Christmas.
5. Maximize all government plans if possible.

• RRSP room can be found on your Notice of Assessment

Lifetime TFSA room is $31,000 with another $5500 in room coming in January.

Converting a stock portfolio with a lot of capital gains to an ETF? The deadline is Christmas Eve Dec 24^th to have those capital gains pertinent to 2014. If you are prepared to wait for one more week, you can do the Sells and they can be counting against your 2015 tax liability, which allows you to push the tax bill back by 12 months. Make sure you keep the asset allocation consistent. On the other hand, you can do part of it for 2014, an additional part in 2015 and the rest in 2016. That will spread the tax bill out over 3 years.

30-day rule. If you sell a stock in a self-directed cash account with a capital gain, and at the same time purchase the same stock in a self-directed TFSA, does the 30 day rule apply? His understanding is that the answer is Yes.

(A Top Pick Dec 31/13. Up 3.15%.) Most of this is Europe, which has had a difficult year. Most people have too much money in Canada. Going forward, he thinks Europe will do better than Canada, because of Canada’s large exposure to energy.