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Today, Larry Berman CFA, CMT, CTA and Teal Linde commented about whether ESI-T, PBH-T, EQX-T, ENB-T, SAP-T, T-N, WEF-T, ATD.B-T, SHOP-T, RCI.B-T, META-Q, AL-N, CVS-N, IPL-T, BB-T, DIS-N, TRP-T, TOU-T, SBUX-Q, T-T, MRU-T, ZWC-T, VRIF-T, ZDV-T, ZWC-T, ZEB-T, ZPR-T, IWN-N, CXF-T, DXG-T, ZWP-T, ZWE-T are stocks to buy or sell.

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COMMENT

We have to distinguish news on vaccine efficacy and trying to chase stocks. Moderna has seen more insiders selling than buying. It is unmistakably speculative. The news is great and the efficacy is fantastic. It will take a couple quarters for vaccines to be distributed. We are already at all time highs though. We see a rotation away from stay at home stocks.

COMMENT

There was a lot of talk that the republicans did very well in the house and senate. Therefore, there was talks we would not see tax hikes. However, he is not sure. They will need to push through tax hikes. They want to do massive stimulus. There will be some battling in Congress. We will probably be surprised by the willingness and degree to let tax hikes happen.

COMMENT

He owns both. Timing is the question. The hedge between the foreign currency and the Canadian dollar. Looking at the Euro-Canadian exchange rate, below 1.50 Euro-Cad, you want exposure to ZWP. Over 1.60, you want ZWE. He is wanting more exposure to the Euro and the British pound, so he is moving towards ZWP.

COMMENT

It has a narrow number of holdings so there will be higher volatility. He would not typically recommend concentrated portfolios. If you are a momentum investor, you could look into it.

BUY

Convertible bonds give some leverage to upside. From that perspective, it is an interesting play. You need to be careful because it is not a fixed income but a play on the equity market. A great tool if you understand where convertibles can fit into your portfolio. You need to be bullish on equities.

BUY

One of his picks of the week. A small cap value ETF. He has been trying to write puts for a week and it just keeps going higher and higher. It is a good holding. How much you hold will depend on how you want to build your portfolio. It is higher risk because it is small cap, but 5-10% exposure could make sense. You want to tilt your portfolio and do not want to be fully in.

COMMENT

We have recovered from a market perspective so it is natural that the ETF moves. Interest does not move as much and he believes the 5 years is anchored. He would not expect a big change in distributions for the time being. You will see some stability and creeping back.

HOLD

There is still some economic risk, such as mortgage forbearance that has not hit Main Street yet. It's not his favourite area. The Canadian banks came back more than American ones so there is probably more value than other areas. As investors move from growth to value, banks could see some upside. Be cautious and he would prefer the ZWB to get into the Canadian banks.

COMMENT

ZWC would be his favourite so he can be more defensive. If you are bullish, ZDV would make sense. Markets have some squeeze potential and there is liquidity coming to markets from stimulus. He does not see materially higher highs than where we are up until early next year.

COMMENT

DON'T BUY

The challenge with the typical balance portfolio is that when you take the yield from bonds and yield from equities like dividends, it is very low. You do not have the same protections as you used to have from bonds in terms of the bonds. Because yield is so low, interest rate risk is higher than it's ever been. He has no problem with the ETF but with the whole asset class.

COMMENT

The caller owns the many of the underlying stocks and is considering switching to this ETF. ZWC is a covered call so you will get some enhanced yield. If you seek yield, it could be a better way to go. If you want flexibility, then the individual stocks makes sense. Hard to know the right answer.

COMMENT

Educational Segment. Looking at the different stock types, we can see that outside of the tech area, which is a big weight in the US large cap market, there has not been a lot of growth and earnings growth per share. If we look at US large caps, there has been earnings growth but it has been 50% compared to a decade ago. Where is the growth coming from? Beyond a handful of stocks, there has been little earnings growth globally. The entire decade has been about multiple expansion and not driven by real earnings growth. The factor behind the expansion is the low interest rates. The guaranteed return has never been lower. This makes the market quite risky.

N/A

Market. Optimism on vaccine progress has been driving the markets since last Monday. Historically pandemics last one to two years and this one seems to be following that same pattern. There has been a lot of assistance this time around compared to history so we will see if businesses can hang in there. Stimulus is expected to be a little lighter. We should be able to get through this. With zero interest rates you HAVE to go to stocks, people think, and this is something to be concerned about. If there is a reversal and interest rates rise, you can imagine what would happen gradually to valuations. Interest rates starting to inch up would make the market go sideways for 3 to 4 years. Increasing interest rates or a decreasing US$ would require interest rates to go up. Make sure you have a portfolio that includes stocks that could handle rising interest rates.

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Latest Stock Buy or Sell? Make More Informed Decisions!

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

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

BMO Europe High Dividend Covered Call Hedged to CAD ET(ZWE-T)

BMO Europe High Dividend Covered Call ETF(ZWP-T)

Dynamic Active Global Dividend ETF(DXG-T)

First Asset Canadian Convertible Bond ETF(CXF-T)

iShares Russell 2000 Value ETF(IWN-N)

BMO S&P/TSX Laddered Preferred(ZPR-T)

BMO EQUAL WEIGHT BANKS INDEX ETF(ZEB-T)

BMO CDN HIGH DIV COVERED CALL ETF(ZWC-T)

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Vanguard Retirement Income ETF Portfolio (VRIF-T)

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