DM Newsletter – December 2017
Including Risk in the Definition of Performance – When reviewing portfolio performance, investors often want to know how they’ve done vs. other available options, which might include comparisons against widely accepted benchmarks, other money managers, or even different asset classes. What is often left out of such cursory analysis, however, is risk and how much of it was borne to achieve realized returns. Unfortunately, risk can be a difficult attribute to quantify ahead of time and is often only fully appreciated after the fact, when damage has already been done.
Click here to read more: DM-Monthly-Report-Dec-17
TFSA or RRSP 2018
One of the most common investment questions Canadians ask themselves today is, “Which is better, TFSA or RRSP”?
Here’s the good news – it doesn’t have to be an either or choice. Why not do both? Below are the features of both plans to help you understand the differences.
Tax Free Savings Account (TFSA)
- Any Canadian resident age 18 or over may open a TFSA. Contribution is not based on earned income. There is no maximum age for contribution.
- Maximum contribution is $5,500 per year.
- There is carry forward room for each year in which the maximum contribution was not made. For those who have not yet contributed to a TFSA, the cumulative total contribution room as of 2017 is $52,000. Read more
The Genetic Non-Discrimination Act and its Impact on Life Insurance
One of the many advancements in medicine has been the use of genetic testing in determining the probability that an individual will develop a life- threatening illness or condition. Knowing that you or your children are not at risk of a major illness can be of great comfort while knowledge to the contrary can be of great value in preventative treatment and planning. There was a growing concern, however, that individuals would be very reluctant to undergo genetic testing if knowing the results could affect their ability to properly insure themselves or impact their opportunities for employment. As a result, a private member’s bill, Bill S-201, was introduced in the senate resulting in the Genetic Non-Discrimination Act being recently enacted into law.
What does the Act do?
It is now illegal for employers, insurance companies, or any other entity or individual to require anyone to undergo genetic testing or to disclose the results of a genetic test before entering into a contract which provides goods or services. Now, if you apply for life, disability or critical illness insurance living benefit coverage, you cannot be denied coverage due to the results of a genetic test. Insurance companies and their agents are also prohibited from “collecting, using or disclosing” the results of a genetic test without an individual’s written consent. Penalties for not complying with the new law are severe. Read more
Cardinal Update – November 2017
RESEARCH PROCESS IN FOCUS: IDEA GENERATION – In our regular correspondence, we tend to discuss why we bought, sold, or continue to hold stocks in the portfolio. This month, we thought it would be interesting to describe the process in how we actually come up with these ideas.
The first step is identifying the stocks we wish to research further. There is no magic formula here and we believe that the wider you cast your net, the more fish you’ll catch. Thus, we read a wide assortment of company financial reports and we also read broadly: newspapers, magazines, books, and trade journals……
COMPANY FOCUS: INTACT FINANCIAL – A year following our initial purchase of Intact Financial, we are happy with the share price performance (up approximately 12%) and take this as an opportunity to review the thesis……
Click here to read more: Cardinal Update – November 2017
