Search

BANK OF NOVA SCOTIA $63.67 (Toronto symbol BNS; Shares outstanding: 1.2 billion; Market cap: $77.3 billion; TSINetwork Rating: Above Average; Dividend yield: 4.2%, www.scotiabank.com) was our #1 pick for 2014.

The stock hit a high of $74.93 in November 2014. It has moved down lately with stock markets, but it’s still up almost 8%, including dividends.

Bank of Nova Scotia is the third-largest of Canada’s five big banks, with $805.7 billion of assets.

...

You are never too old to have a long term investing strategy

GLOBAL X COPPER MINERS ETF $5.26 (New York symbol COPX; buy or sell through brokers; www.globalxfunds.com) tracks the Solactive Global Copper Miners Index, which includes 20 to 40 international companies that mine, refine or explore for copper. Germany-based Structured Solutions AG created this index.

Canadian firms make up 38.8% of the ETF’s holdings. It also includes companies based in Australia (15.6%), Mexico (5.5%), Peru (5.4%) and Poland (5.0%). The fund’s MER is 0.65%.

Its top holdings are Sandfire Resources at 10.4%; Southern Copper, 7.9%; Oz Minerals, 7.7%; Grupo Mexico, 6.9%; Vedanta Resources, 6.8%; Lundin Mining, 6.3%; Antofagasta plc, 5.9%; KGHM Polska Miedz, 5.7%; Turquoise Hill, 5.6%; Jiangxi Copper, 5.2%; and Freeport- McMoRan, 4.4%.

...

GLOBAL X SILVER MINERS ETF $7.41 (New York symbol SIL; buy or sell through brokers; www.globalxfunds.com) tracks the Solactive Global Silver Miners Index. This index includes 25 international firms that mine, refine or explore for silver. It was developed by Germany-based Structured Solutions AG.

Canadian firms make up 58.0% of the fund’s holdings, but it also includes miners in the U.S. (12.3%) and Mexico (11.2%). Its MER is 0.65%.

...

ISHARES S&P/TSX GLOBAL GOLD INDEX FUND $8.55 (Toronto symbol XGD; buy or sell through brokers; ca.ishares.com) aims to mirror the performance of the S&P/TSX Global Gold Index, which is made up of 38 gold stocks from Canada and around the world. The ETF began trading on March 23, 2001. Its MER is 0.61%. The fund’s top holdings are Goldcorp at 13.6%; Newmont Mining, 11.5%; Barrick Gold, 9.7%; Franco-Nevada Corp., 9.3%; Agnico-Eagle Mines, 7.6%; Randgold Resources (ADR), 7.4%; AngloGold Ashanti (ADR), 4.3%; and Royal Gold, 4.0%.

iShares S&P/TSX Global Gold Index is a hold.
...

MARKET VECTORS VIETNAM ETF $17.317 (New York symbol VNM; buy or sell through brokers) holds Vietnamese companies or foreign firms that get a significant amount of their revenue from Vietnam.

The ETF’s top holdings are Vincom Corp. (real estate), 7.8%; Bank for Foreign Trade of Vietnam, 7.5%; Masan Group (a food, resources and banking conglomerate), 6.5%; Saigon Thuong Tin Commercial Bank, 6.3%; and Baoviet Holdings (insurance), 6.1%.

The ETF cuts risk by investing part of its assets in firms that are based outside of Vietnam but still do business there. That’s a better approach than adding thinly traded or illiquid shares of smaller Vietnamese firms.

...

VERESEN $11.60 (Toronto symbol VSN; Shares outstanding: 292.0 million; Market cap: $3.2 billion; TSINetwork Rating: Average; Dividend yield: 8.6%; www.vereseninc.com) and KKR & Co. LP (symbol KKR on New York) formed a joint venture in late 2014 called Veresen Midstream.

The partners then bought natural gas gathering and compression assets in northeastern B.C. from Encana and Japan’s Mitsubishi Corp. for $1 billion.

As well, Veresen Midstream agreed to undertake a $5-billion expansion for gas producers, including Encana. This development would be backed by 30-year contracts that would significantly cut Veresen Midstream’s risk.

...

ISHARES MSCI CANADA INDEX FUND $24.49 (New York symbol EWC; buy or sell through brokers; ca.ishares.com) holds the stocks in the Morgan Stanley Capital International Canada Index. The fund has a 0.48% MER and yields 1.7%.

The index’s top holdings are Royal Bank, 7.7%; TD Bank, 7.1%; Valeant Pharmaceuticals, 5.6%; Bank of Nova Scotia, 4.9%; CN Railway, 4.4%; Suncor Energy, 3.7%; Bank of Montreal, 3.5%; Enbridge, 3.1%; and Manulife Financial, 3.0%. If you want to own a Canadian index fund, you should buy the iShares S&P/TSX 60 Index ETF (see previous page). You’ll pay about a third of the management fees.

We don’t recommend the iShares MSCI Canada Index Fund.

...

POWERSHARES QQQ ETF $105.63 (Nasdaq symbol QQQ; buy or sell throughbrokers ; www.invescopowershares.com), formerly called Nasdaq 100 Trust Shares, holds stocks representing the Nasdaq 100 Index, which consists of the 100 largest shares on the Nasdaq exchange by market cap.

The Nasdaq 100 Index contains shares of companies in a number of major industries, including computer hardware and software, telecommunications, retail/wholesale trade and biotechnology. It does not contain financial firms. The fund’s expenses are about 0.20% of its assets. It yields 1.0%.

The index’s highest-weighted stocks are Apple, Microsoft, Amgen, Google, Cisco Systems, Intel Corp., Amazon.com, Gilead Sciences, Comcast and Facebook.

...

ISHARES CANADIAN SELECT DIVIDEND INDEX ETF $22.48 (Toronto symbol XDV; buy or sell through brokers; ca.ishares.com) holds 30 of the highestyielding Canadian stocks. Its selections are based on dividend growth, yield and payout ratio. The weight of any one stock is limited to 10% of the ETF’s assets. The fund’s MER is 0.55%, and it yields 4.3%.

The fund’s top holdings are CIBC, 9.7%; Bank of Montreal, 6.8%; Royal Bank, 6.5%; BCE, 5.8%; Bank of Nova Scotia, 5.5%; Laurentian Bank of Canada, 5.0%; Rogers Communications, 4.5%; Manitoba Telecom, 4.4%; TD Bank, 4.4%; National Bank, 4.1%; IGM Financial, 4.0%; and Emera Inc., 3.8%.

The ETF holds 53.7% of its assets in financial stocks. The top Canadian finance stocks have sound prospects, but if you invest in this ETF, be sure to adjust the rest of your portfolio so it won’t be overly concentrated in the financial sector.

...

ISHARES S&P/TSX 60 INDEX ETF $20.47 (Toronto symbol XIU; buy or sell through brokers; ca.ishares.com) is a good low-fee way to buy the top stocks on the TSX. The units are made up of stocks that represent the S&P/TSX 60 Index, which consists of the 60 largest, most heavily traded stocks on the exchange. Expenses are just 0.18% of assets, and the units yield 3.1%.

The index mostly consists of high-quality companies. However, it must ensure that all sectors are represented, so it holds a few we wouldn’t include.

The index’s top holdings are Royal Bank, 8.3%; TD Bank, 7.7%; Valeant Pharmaceuticals, 6.0%; Bank of Nova Scotia, 5.6%; CN Railway, 4.7%; Suncor Energy, 4.0%; Bank of Montreal, 3.7%; BCE, 3.6%; Enbridge, 3.3%; Manulife Financial, 3.2%; CIBC, 3.0%; Brookfield Asset Management, 2.8%; and TransCanada Corp., 2.4%.

...

ENBRIDGE INC. $55.89 (Toronto symbol ENB; Shares outstanding: 860.1 million; Market cap: $46.6 billion; TSINetwork Rating: Above Average; Divd. yield: 3.3%; www.enbridge.com) has received regulatory approval to reverse the flow of crude oil on its Line 9 pipeline between Sarnia, Ontario, and Montreal.

Under the plan, oil will now flow from Sarnia to Montreal. Enbridge will also increase the line’s capacity so it can handle heavy crude from Alberta’s oil sands.

It took longer than expected for regulators to sign off, so the project’s cost jumped to $800 million from its original estimate of $100 million. To put that in context, Enbridge earned $505 million in the latest quarter.

...

ENERPLUS CORP. $8.15 (Toronto symbol ERF; Shares outstanding: 206.2 million; Market cap: $1.6 billion; TSINetwork Rating: Extra Risk; Dividend yield: 7.4%) produces an average of 107,429 barrels of oil equivalent a day (57% gas and 43% oil). Its properties are mainly in Alberta, Saskatchewan, B.C., North Dakota and Montana, as well as in the Marcellus shale, which passes through Pennsylvania, New York, Ohio and West Virginia.

Enerplus increased its production by 3.3% in the three months ended June 30, 2015, but that wasn’t enough to offset sharply lower oil and gas prices; cash flow per share fell 25.0%, to $0.78 from $1.04. Like Crescent Point, Enerplus has cut exploration spending this year. Its outlays will now total $580 million, down 28.5% from $811.0 million in 2014.

The lower spending, along with Enerplus’s plan to produce less gas in the Marcellus shale until prices rise, will cut its forecast 2015 production to around 105,199 barrels of oil equivalent a day.

...

CRESCENT POINT ENERGY CORP. $19.86 (Toronto symbol CPG; Shares outstanding: 498.3 million; Market cap: $9.4 billion; TSINetwork Rating: Extra Risk; Dividend yield: 6.0%; www.crescentpointenergy.com) produces oil and natural gas in Western Canada, with a focus on its Bakken light oil development in southeastern Saskatchewan. Its output is 91% oil and 9% gas.

In the three months ended June 30, 2015, Crescent Point’s cash flow fell 17.7%, to $524.3 million from $636.7 million a year earlier. The company raised its daily output by 10.4%, but lower oil and gas prices offset that increase.

Cash flow per share declined 26.5%, to $1.14 from $1.55, because the company issued shares to pay for acquisitions, including $1.5 billion for Legacy Oil + Gas in June 2015.

...

CANADIAN PACIFIC RAILWAY LTD. $199.75 (Toronto symbol CP; Shares outstanding: 161.0 million; Market cap: $31.3 billion; TSINetwork Rating: Above Average; Dividend yield: 0.7%; www.cpr.ca) prefers to use its excess cash to buy back shares instead of raising its $1.40- a-share dividend, which yields 0.7%. That’s because many of its investors live in the U.S. and are subject to withholding taxes on dividends from Canadian firms.

The company could repurchase up to 9.1 million shares under its latest authorization, and it’s now closing in on that limit, so CP has raised it to 11.9 million shares, or 7% of the 161.0 million outstanding as of June 30, 2015.

The company expects to complete these purchases by March 17, 2016.

...

ALLIED PROPERTIES REAL ESTATE INVESTMENT TRUST $34.30 (Toronto symbol AP.UN; Units outstanding: 77.9 million; Market cap: $2.7 billion; TSINetwork Rating: Extra Risk; Dividend yield: 4.3%; www.alliedreit.com) owns 146 office buildings, mostly in major Canadian cities. These mainly Class I properties contain over 10.5 million square feet of leasable area. Class I refers to 19th- and early-20th-century industrial buildings that have been converted to retail space. They usually feature exposed beams, interior brick and hardwood floors.

Allied spent $400 million acquiring properties in 2012, $182.4 million in 2013 and $234.9 million in 2014. In the first half of 2015, it added three more for $136.1 million.

...

RIOCAN REAL ESTATE INVESTMENT TRUST $25.78 (Toronto symbol REI.UN; Units outstanding: 318.8 million; Market cap: $8.1 billion; TSINetwork Rating: Average; Dividend yield: 5.5%; www.riocan.com) is Canada’s largest real estate investment trust.

In the three months ended June 30, 2015, RioCan’s revenue rose 6.3%, to $322.3 million from $303.2 million a year earlier. Cash flow per unit gained 2.4%, to $0.42 from $0.41.

The trust has now agreed to unwind its 50/50 joint venture with U.S.-based Kimco Realty. This business manages 35 malls across Canada.

...

SUN LIFE FINANCIAL $44.38 (Toronto symbol SLF; Shares outstanding: 610.6 million; Market cap: $27.0 billion; TSINetwork Rating: Above Average; Dividend yield: 3.4%; www.sunlife.ca) continues to expand in the U.S. At the same time, it’s cutting its risk by focusing on highly profitable niche markets with low capital reserve requirements.



In June 2015, the company bought U.S....

BANK OF NOVA SCOTIA $60.29 (Toronto symbol BNS; Shares outstanding: 1.2 billion; Market cap: $72.2 billion; TSINetwork Rating: Above Average; Dividend yield: 4.6%, www.scotiabank.com) is the third-largest of Canada’s five big banks, with $863.1 billion of assets.

In its fiscal 2015 third quarter, which ended July 31, 2015, the bank earned $1.85 billion, up 2.8% from $1.80 billion a year earlier. Earnings per share rose 3.6%, to $1.45 from $1.40, on fewer shares outstanding.

Revenue fell 5.6%, to $6.1 billion from $6.5 billion, but that was mainly because Bank of Nova Scotia sold most of its shares in mutual fund provider CI Financial (Toronto symbol CIX) in 2014. Earnings at the Canadian banking division (49% of the total) rose 14.9% on improving loan and deposit growth. The international business (30%) saw its earnings rise 10.5%, thanks to strong loan demand in Latin America and favourable currency rates.

...

Canadian annuities offer a predictable source of income—but we advise against buying them.

The acquisition of a U.S. packaging firm looks like a perfect fit is for one of our leading value stocks, printer Transcontinental Inc.

The price of natural gas, like the price of oil, is highly volatile—and influenced both up and down by a wide range of factors. So it’s a bad idea to base investment decisions on predictions of future natural gas prices, and their effects on natural gas stock prices, because these predictions are simply not reliable.

However, you can profit nicely over long periods by investing in well-established or well-managed companies that are active in businesses that involve highly volatile commodities like oil and gas. You profit all the more if you buy these companies when they are cheap in relation to earnings and assets.

...

With growing real estate portfolios in key Canadian markets, we view RioCan and Allied Properties REITs as strong dividend stocks.

Rules you need to follow when buying mutual funds for the long-term success of your portfolio.

Takeovers have helped Canadian beverage maker Cott Corp gain momentum as a growth stock, but the company also faces a number of risks.