DM Monthly Report – Oct 2019

CAPITAL ALLOCATION FOLLOWING SENTIMENT – Last month we highlighted the low level of bullishness indicated in recent investor surveys and noted that such pessimistic readings often presage market strength. Hard data are pointing in the same direction right now, with individuals confirming their negative sentiment through their capital allocation decisions and choice of equity sectors.

Click here to read more:  DM-Monthly-Report-Oct-19

DM Monthly Report – Sept 2019

ARE THE STOCKS IN YOUR PORTFOLIO A CONTRARIAN POSITION?  It’s a curious thing. Even though publicly traded shares are a direct connection to the wildly successful free market system and the easiest way to grab a share of the wealth that has been and will be created by the capitalist economy, individuals are surprisingly ambivalent about owning them. In fact, the calls we get about stocks are often tinged with a trace of dread. If markets are up, people are skeptical about how long it’ll last and if they’re down, they worry that the dip is the beginning of something worse.

Click here to read more:  DM-Monthly-Report-Sep-19

Cardinal Update – September 2019

Don’t Fear a Recession When You Have a Quality Portfolio:  The “R Word” has been cropping up as of late, especially since the U.S. 2 year and 10 year yield curve inverted briefly. When you add this signal to the trade disputes, slowing global growth and various geopolitical events, it certainly raises the risk of a recession in the next year or two.

It’s not yet a done deal as employment remains strong, inflation is low and economic growth, while slowing, is still positive. There are also some unusual forces including the search for positive interest rates, central bank quantitative easing, flight to quality and aging demographics that are pushing longer-term interest rates down. But ignoring the warning signs can be perilous.

Click here to read more:  Cardinal Update – September 2019

Cardinal Update – August 2019

What’s Weighing Down the Banks – Over the past year, the equal-weighted average total return of the Big Six Canadian banks has underperformed the broader TSX index.

Some of this underperformance if due to broader industry concerns, while the balance relates to name-specific concerns that have dragged down total returns.

Within the industry itself, Canadian housing, interest rates, and credit are the main areas of focus.

Click here to read more:  Cardinal Update – August 2019