Back-to-school strategy update: Positioned for narrowing leadership

Canadian and U.S. morning comments

September 5, 2017

OUR TAKE: We continue to prefer equities to bonds, but the magnitude of our equity confidence has moderated following 2016/1H17 double-digit equity gains. We entered 2017 with a recommended equity weighting of 66%, and we lowered our equity exposure to 62% in July (Cash has gone up to 6% from 2%). We expect modest equity performance in 2H17/2018 as sentiment is challenged by fading global PMI momentum, tougher year-over-year earnings comparisons, and broadening policy normalization. Our EM/Europe OW recommendation remains unchanged, and we expect Canada/TSX to catch up with the S&P 500 in the latter part of 2017. LatAm usually outperforms in periods of Fed tightening, and LatAm has been leading since the first Fed rate hike in December 2015. In our opinion, LatAm will maintain its edge until the end of the cycle. Stay OW.

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Financial literacy

An emerging educational imperative

August 31, 2017

Until comparatively recently, financial literacy was not considered to be a necessary part of a high school education. Slowly but surely that shortcoming is beginning to be addressed.

Financial literacy is taking root – at last

A newly announced Ontario government program will soon make financial literacy a reality for high-school students. In B.C. financial literacy is now taught in every grade within a newly revised math curriculum. In Alberta teaching financial literacy is a priority in schools according to a new survey – involving 32,391 parents, teachers and students – conducted by Alberta Education. And here in Nova Scotia, financial literacy is embedded into mathematics, social studies and health education from primary to Grade 9 and then expanded on in selected high school courses. This is very encouraging news.

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