A New Bull Market and a New Way to participate
Are you catching the Stock Market train? We are.
After four years of extremely volatile markets and uncertainty, resulting in minimal returns, I think we may have some good market years ahead of us. Even with the Dow Jones trading at all-time highs, there appear to be many strong investment opportunities:
-Many North American corporations are cash rich which can provide much catalyst for the broad markets.
-There are still many out of favor companies trading at very low valuations.
-The possibility of investors selling bonds to buy stocks could be positive for equity markets.
-There may still be many years of attractive fixed income yields if interest rates move higher.
With the Dow Jones Average recently touching all-time highs of 14400, we are reminded that this index is really recovering from the past 5 years, which saw the Dow trade as low as 6470. If a recovery is now in place, we could see much improved share prices over the next several years.
We have recently created a new niche allowing smaller investors access to our Discretionary Management services. Please contact Marc-Antoine for more details.
Our specialty is providing assistance to spouses and families during the onset of Major Neurocognitive Disorders (Alzheimer's and other Dementias), Sudden (terminal) Illness and at Bereavement. Our "One-Step-At-A-Time" process helps these individuals work through significant financial and non-financial issues.
We are always interested in meeting and helping new clients.
R.T. James Whitehouse
Portfolio Manager, Vice President
Whitehouse Portfolio Management Group
National Bank Financial Wealth Management
403-531-8461
September - October Commentary
New Core Holdings
We are starting to add 2 Canadian Banks (yielding 4.2%) and a Canadian Telecom Company (yielding 5.2%) to clients' portfolios, where suitable. Although these stocks are trading at fairly high valuations, we have decided that the dividend yields are attractive and we will add positions over the next month.
Our strategy of building conservative portfolios continues to add value with our 6% Corporate Bond fixed income yield. Core holdings such as our 3 new additions provide strong dividends with an average equity yield of 4%.
Our group is always interested in meeting and assisting new clients.
We also specialize in providing assistance to Families when a spouse is experiencing the onset of Mental Incapacity, Sudden (Terminal) Illness and Bereavement. This area involves a wide range of Family matters that are critically important during these difficult periods.
Our "One-Step-At -A -Time" process (O.S.A.A.T.) provides families with a comprehensive and thoughtful approach, which we are always working to improve, as we learn more from existing and new clients. We are also learning as much as we can with the help of professionals in these fields.
*Rates are subject to change.
Looking Forward to Higher Yielding Bonds
As a portfolio manager, I am very content to close out 2013 with 3 strong bond positions in our clients' portfolios. Depending on availability and suitability, we are holding a 6% Canadian Industrial corporation 2022 Bond, a Canadian Mining corporation US 9.5% 2020 Bond and a 3.5% Provincial Government 2015 Bond. These fixed income investments are core holdings for our portfolios.
If interest rates start to increase (and I certainly believe that rates are slowly rising), bonds will start to indicate higher yields and be more attractively priced. We will be watching for any opportunities to add to our portfolios.
We continue to hold 2 Canadian Bank stocks- average yield 4.5%, a Canadian Telecommunications company-average yield 5.5% and 2 Public Utility companies-average yield 6 % in most portfolios**. A Canadian Retail company is a recent addition, for an average 6.4% * dividend yield. As of January, 2013 we have added dividend re-investment programs (DRIP) to most stock positions.
Our specialty is providing assistance to spouses and families during the onset of Major Neurocognitive Disorders (Alzheimer's and other Dementias), sudden (terminal) illness and at bereavement. Our "One-Step-At-A-Time" process helps these individuals work through significant financial and non-financial issues.
We also provide Discretionary Management services to many different families and enjoy meeting and helping new clients.
*Rates are subject to change.
** Your individual portfolio may not hold all of the above securities.
August Commentary
POSITIVE MARKETS REWARD OUR CLIENTS WITH SELL PROFITS
Small upward moves in the markets over the past 2 months have provided attractive short-term gains in many portfolios.
Clients sold an oil and gas producer, that we bought in June, for average gains of 10% - 17%. Most portfolios have also sold a US investment management company, for gains of 7% - 15%. The hold period for this stock averaged 7 months.
We still have some underperforming stocks across most portfolios, which we look forward to selling, should their stock prices continue to improve.
A new market segment has emerged with "US Assets" oil and gas income trusts. When the Federal Government enacted legislation in 2007 to start taxing Canadian income trusts, they continued to allow for Canadian income trusts to operate if they held only US operating businesses. A new issue oil & gas income trust starting trading on the TSX on August 10,2012. We think this company represents reasonable opportunity for our clients and we were able to place shares in most portfolios. The trust will start paying a 10.5% monthly distribution in September, 2012.
Fixed income in most portfolios continues to hold the 6% -10 years Bond, some 3.3% Alberta Government Bonds and 1.5% - 2.36% GICs. Cash balances earn 1.45%* in the NBC Altamira High-Interest Cash Performer account.
We are always interested in meeting and helping new clients. Our specialty is providing assistance to spouses during the onset of mental incapacity, sudden(terminal)illness and at bereavement. Our "One-Step-At-A-Time" process provides these individuals with help during a very difficult period.
Hope you continue to enjoy a great Summer.
*Rates are subject to change.
July Commentary
OPPORTUNITY KNOCKS IN JUNE
We were able to buy a very limited amount of a 6% - 10 year Bond, at close to par value, for many of our clients during a 3 day period in June.
A 140 year old Canadian Steel manufacturer, issued a Baa, BB rated bond in April, 2012, that was not readily available to the public markets. With the help of our NBF bond desk, I was able to purchase a limited quantity of this Bond.
Having placed the bond in most discretionary accounts, I will offer this bond to non-discretionary accounts, depending on availability and pricing. I will be contacting clients if and when the bond does become available.
Our Canadian REIT takeover was completed on June 29th and all remaining shares were replaced with cash. We have also sold a major gas producer stock in most portfolios for short term gains of between 10% and 25% .
We are adding a new Oil & Gas producer, for a 7.6% yield to most portfolios. I am also starting to add two major Canadian Banks yielding 4.4% and 4.2% where applicable.
A portion of fixed income in our portfolios is now yielding 6%, with the addition of our 10 year Bond. Cash balances are earning 1.45%* in the NBC Altamira High-Interest Cash Performer account.
We are always interested in meeting and helping new clients. Our specialty is providing assistance to spouses during the onset of mental incapacity, sudden(terminal)illness and at bereavement. Our "One-Step-At-A-Time" process provides these individuals with help during a very difficult period.
Hope you are enjoying a great Summer.
*Rates are subject to change.
R.T.James Whitehouse
June Commentary
OPPORTUNITIES IN TOUGH EQUITY MARKETS
Maybe the "Sell In May" adage for 2012 should have been "Sell In March". But alas, we usually are not that nimble with our investments.
Even though most of our clients have enjoyed profits with our REIT takeover and a short-term gain on a social media company, we still hold several dividend paying stocks that are trading below our costs.
When we see these types of decline, we are always looking to add to our strong dividend paying stocks, at lower prices and therefore higher yields.
We did not buy the most recent social media IPO in any accounts. (other than 1 small unsolicited order).
We continue to own an Alberta utility with an average dividend yield of 7%.
Fixed income in our portfolios continues to be invested in 1 and 2 year GICs, paying 1.75%* and 2.15%* respectively. Cash balances are earning 1.45%* in the NBC Altamira High-Interest CashPerformer account.
We are always interested in meeting and helping new clients. Our specialty is providing assitance to spouses during the onset of mental incapacity, sudden(terminal)illness and at bereavement.
ENJOY THE START OF SUMMER
*Rates are subject to change.
R.T. James Whitehouse
May Commentary
Takover Activity in our Portfolios
During April and May, most of our clients' portfolios have enjoyed receiving takeover announcements related to securities we hold.
Our portfolio position in a Canadian Apartment REIT has received a cash offer of $14.25 per share. This represents a 19.3% premium to the 20-day volume weighted average price. Throughout clients’ portfolios, total returns will vary from 20% to 80% including dividends, for a hold period of 6 months to 2 years, assuming the takeover is completed.
In late March, our portfolio position in an intermediate Calgary oil and gas company received an all share exchange offer from another oil and gas company. The exchange ratio premium was 11% at the time of the announcement.
We have added a Canadian Utility company to most Discretionary Portfolios and are currently contacting our Non-Discretionary clients. These shares are paying a 7% dividend based on the current price.
Fixed income in our portfolios continues to be invested in 1 and 2 year GICs, paying 2.15%* and 2.35%* respectively. Cash balances are earning 1.45%* in the NBC Altamira High-Interest CashPerformer account.
ENJOY YOUR MONTH OF MAY
*Rates are subject to change.
April Commentary
WELCOME TO SPRING
We are well into our first month of spring and the markets continue to be volatile for All investors.
During this period of market weakness, portfolios continue to receive dividend payments and opportunities to attract even larger dividends start to materialize. Our current portfolio positions are paying average dividend yields of 4% to 7%.
Fixed income in portfolios continues to be invested in 1 and 2 year GICs, paying 1.9%* and 2.2%* respectively. Cash balances are earning 1.45%* in the NBC Altamira High-Interest CashPerformer account.
We are always interested in meeting and helping new clients. If you would like to arrange an initial phone consultation with myself, please contact my assistant Carol at carol.tong@nbf.ca or 403 531 8426.
ENJOY YOUR SPRING
Jim Whitehouse
*Rates are subject to change.
February Commentary
January and February have been quite busy with RRSP contributions and we would like to remind you that the deadline is February 29.
January has also given many of our clients a gracious welcome to 2012. Our investments in a major US Investment Bank and a major US Wealth Manager have appreciated in value and could continue to add value to portfolios.
We are now adding one major and one intermediate gas producer to most portfolios. These companies are currently paying 4% and 8% dividends respectively. My decision to invest in gas companies is based on industry reports of major shut-ins, significant reduction in drilling, low gas prices and 50% declines in the valuation of these companies over the past year. Both companies appear to be capable of paying their current dividends. We do not expect to pick the bottom of a gas cycle, but we may be close and clients will be paid to wait.
Fixed income in portfolios continues to be invested in 1 and 2 year GICs. Cash balances are now earning 1.45%* CAN and .45%* US in the NBC Altamira High-Interest CashPerformer account. This account is covered by CDIC** up to $100,000 and withdrawals can be made at anytime, with one day settlement.
If you are interested in our Wealth Management services, please contact us to arrange an initial phone consultation.
Enjoy our transition to Spring. Will it be "in like a Lamb" or "in like a Lion"??
*Rates are subject to change. 1.45% and .45% are paid on fee-based accounts only.
**US dollar deposits are not covered by CDIC.
October Comment - Now that October is over
NOW THAT OCTOBER IS OVER …
I think we need to be cautious when the media and pundits report about fantastic gains in the markets. Certainly, we all want our investments to grow in value, but one month of increases in market indices should not suggest that all share values have returned to previous higher levels.
More importantly, if an investor was able to take advantage of the October increase, they would have needed available cash in September.
For the most part, our clients are holding large cash balances from taking profits in August, 2011. October provided an opportunity to add to one existing position and buy another favoured company with a dividend yield averaging 7.5%.
October also allowed us to sell some US and Canadian investments at break-even prices (minimal or no losses, including dividends)
Yes, markets often provide opportunities and I am content to have cash available to buy some select stocks, if and when their prices warrant purchases.
If you are interested in our services and would like to review your investments, please call or email Terri Bedard to arrange an initial phone consultation. terri.bedard@nbc.ca (403) 531 8426
R.T. JAMES WHITEHOUSE
Portfolio Manager and Vice President
Whitehouse Portfolio Management Group
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