Monthly World Markets Report


Canadian investors have a challenging relationship with the energy sector. Certainly, during periods of accelerating global growth, the energy sector has been a key driver of the Canadian economy. On the other hand, partly due to environmental and political issues, the sector has struggled in recent years even as oil prices have recovered nicely off the lows hit in early 2016.


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The Case for Tax-Free Investing



The Tax-Free Savings Account (TFSA) gives Canadian residents a way to save, tax-free. When you contribute to a TFSA, your investments can grow taxfree and you will not pay tax on income or capital gains earned within the account, even when you make a withdrawal, providing you follow the rules on contribution limits and eligible investments. The TFSA can play an important role in your financial plan regardless of your stage of life. Whether you are putting money aside for a new home, a child’s wedding or a family vacation, or you want to supplement your retirement income, the TFSA can help you save for what matters to you..


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Ten ways to reduce taxes in 2019

Ten ways to reduce taxes in 2019

Most business owners are certainly happy that the modifications to the taxation of small businesses that are part of the federal 2018 budget are not as drastic as those announced in 2017. This being said, the new tax rules will make passive investment income earned in a business less interesting for some small business owners. They may therefore be looking for more advantageous investment alternatives. They should consider Individual Pension Plans (IPPs) and Retirement Compensation Arrangements (RCAs).

This document presents our views on the broad impact of the new tax rules and should not be considered as tax advice. We will be pleased to work with tax and investment advisers to further assess whether an IPP or an RCA can help to maximize their clients’ retirement savings. A business owner must receive or start receiving T4 income to consider these retirement plans.

Preferred Share Update

Market Recap and Commentary

The Canadian Preferred Share market has had a lackluster second quarter and was not exempt from the recent volatility we have seen across asset classes. We have continued to see good performance from the rate reset/floating rate preferred share market as the Canadian 5-year bond yield inched higher from 2.00% to 2.21%. The recent performance of the rate-reset/floating preferred market is of no surprise to us since these securities have negative duration in a rising-rate environment.
With two rate hikes, one in January and the second in July 2018 preferreds have not performed as they should. Bank of Canada Governor Stephen Poloz is doubtful to be in a hurry. There remains a long list of reasons for caution, starting with the real possibility of Canada getting into a trade war with its biggest
trading partner. CIBC chief economist Avery Shenfeld, said “There is no preset calendar to higher rates and how fast they come will depend on how well the
economy does.”
Holders of preferred shares need to be patient and hold the course. Rates will continue to rise in late Q4/2018 or Q1/2019. A portfolio that is overweight in fixed-reset preferreds and a well-balanced fixed income bond selection should result in good returns. The market may have to face some headwinds in 2018 with fluctuating interest rates along with an expected decline in new issues from 2017 levels which should help to keep prices and demand



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Budget 2017/18: Same Numbers, More Details

It’s a somewhat less exciting budget, but mostly because the government scooped itself by laying out all the big numbers last year. With Canada’s economy sparking back to life in recent quarters, near-term deficit projections have eased off, but the targets for the debt-to-GDP ratio in the medium term only allowed for modest new elbow room for spending.


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