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Market. `` Quantitative easing was when the Fed was pumping money out into the market by buying bonds – $4.5 Trillion. Quantitative tightening is the opposite. They are pulling money out of the system and affecting overall liquidity. So now the market does not have those support levels. Earnings are still growing, however, so that is cause for some optimism. Companies beating earnings expectations could change the sentiment in the marketplace.
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ETS and REITs: Are there Trending ETFs that provide significant growth? An ETF is just a container for companies. There are so many ETFs out there but the market has not done well this year. He would not blame the ETF structure for bad performance. You have to focus on what you believe is the right way to go. A REIT ETF is a good thing in that it lets you invest in REITs.
HOLD
A BMO covered call ETF on Canadian banks. It is not a trading vehicle. The purpose of a covered call ETF is to harvest the premiums. This has gone down by less than an ETF just focused on banks with no covered calls. This is a longer term vehicle. Get it if you expect banks to be range bound or go up a little, but if they were going to rocket up you would not want the covered calls.
E.T.F.'s
COMMENT
Canadian Materials ETF. It is 70% gold equities. They earn a dividend but MXF-T writes covered calls on 25% of their holdings and then pays a distribution. It has gone down with the overall market and then broke its trend to move sideways. If you expect the sector to do okay this is a good way to get exposure to this. Covered calls work well when there is slow growth in the stocks it holds.
E.T.F.'s
COMMENT
Educational Segment. What history tells us about the performance of the TSX vs. US markets. We tend to think that if the TSX underperforms this year then it will definitely outperform next year. Historically, that just has not been the case. We often underperform for a few years and then outperform for a few years. One of the determining factors is the price of oil and the energy sector. The TSX performs closer to the US Energy sector less the S&P percent gain for a year. And there is a high correlation of the TSX to the price of oil. Starting October we saw a slide in the price of oil.
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Market. In October he said there was a minimum 85% chance of the market dropping over 20% by the end of 2020 and he did say it could happen this year. It is not surprising him. It is the biggest December sell-off since the depression. Debt levels of governments were not tamed during good times. He is surprised only by how much it has come down and how quickly. Markets were really high and people recognized the problems. People are asking what governments will do as we head into a recession. Human psychology says that when things are bad you run out the door. It could be a reasonable time to buy now and there could be more opportunity ahead.
WATCH
He is looking at it. It has been on his watch list for quite a while. They made the same mistake as before when they ran up debt. They are selling off things that will hurt them. They don't seem to care that much about Canada now. Governments may be less likely to feed them in the future. It could be a good buy later on. He would rather sit back and watch it.
transportation equip & components
WATCH
He used to own it and sold it at a slight loss. It is in a sector having major difficulties. He continues to watch it but is not brave enough to buy it. It has no debt and the government is being more generous with media companies. If they keep on losing money then that is a problem.
publishing
printing
WEAK BUY
It has been beaten up badly and he is surprised by how much. The dividend is reasonable but the payout ratio is a little higher than he likes. It is not a contra stock because the upside is not high enough but he bought it for the dividend with capital appreciation. It has a lot of government support in Ontario. The increase in minimum wage hurt EXE-T.
other services
