diversification

CHEMTRADE LOGISTICS INCOME FUND $17.09 (Toronto symbol CHE.UN; TSINetwork Rating: Speculative) (416-496-5856; www.chemtradelogistics.com; Units outstanding: 41.7 million; Market cap: $709.7 million; Dividend yield: 7.0%) is in talks to buy specialty chemicals maker General Chemical Corp....

We haven’t found any water-focused stocks we recommend as buys. That’s mostly because the water business has limited growth prospects in developed countries, and is subject to a lot of regulatory hurdles. It may offer more opportunity in developing countries, many of which are in desperate need of clean water, but investing in these countries exposes you to political risk. However, here’s a look at the iShares S&P Global Water Index ETF: iShares S&P Global Water Index ETF, $21.31, symbol CWW on Toronto (Shares outstanding: 1.5 million; Market cap: $32.0 million; ca.ishares.com), aims to match the performance of the S&P Global Water Index. The index is made up of 50 stocks selected from companies listed on global developed market exchanges. The companies are picked based on the relative importance of the global water industry to their businesses....

AASTRA TECHNOLOGIES, $36.16, symbol AAH on Toronto, jumped over 29% this week after the company said it has agreed to a friendly takeover offer from Mitel Networks (symbol MNW on Toronto). Mitel is offering $6.52 U.S. in cash and 3.6 Mitel common shares for each share of Aastra. Based on today’s price for Mitel stock, the offer is worth $37.16 per Aastra share. Aastra develops and markets products and systems for accessing communication networks, including the Internet. Its technology is centred around business telephone systems and includes products that integrate land lines and mobile phones....

More and more, I find that I cringe a little every time an investor tells me that they recognize their current investment approach is not appropriate, but they are not yet ready to switch. With a little probing, these investors usually go on to explain that they have lost too much money with the current approach, and they “can’t afford” to sell out at current prices and convert that paper loss into a real one. Instead, they plan to stick with the current approach for an indefinite period. Sometimes they want to hold on to their current portfolio until they get back to break-even. Others say they’ll be satisfied if the current loss shrinks by, say, half. I recall one time in summer 2000. A friend asked me to have a short chat with a female relative who had just gone through a divorce and had received “a very generous settlement”. He said he didn’t know the details but the lady wanted an outside opinion on what to do with her money....

Black Diamond Group, $27.26, symbol BDI on Toronto (Shares outstanding: 42.0 million; Market cap: $1.2 billion; www.blackdiamondlimited.com), is a Calgary-based company that builds modular buildings and housing for workers at remote sites, such as mines and drilling rigs. It also provides oilfield services and equipment. Aside from oil and gas and mining, Black Diamond’s customers include electricity, construction and engineering businesses, as well as government agencies. The company’s Camps division rents and sells remote workforce housing and provides associated services. Its temporary structures include large dormitories, kitchen/dining facilities and recreation complexes. This division is largely focused on western Canada. The company’s logistics division operates remote lodging facilities for third parties. It also owns the sprawling Sunday Creek Lodge, which provides accommodations for corporate clients in the northern Alberta oil sands. Black Diamond Logistics also transports, installs, dismantles, repairs and maintains modular structures for customers....

CHEMTRADE LOGISTICS INCOME FUND $17.09 (Toronto symbol CHE.UN; TSINetwork Rating: Speculative) (416-496-5856; www.chemtradelogistics.com; Units outstanding: 41.7 million; Market cap: $709.7 million; Dividend yield: 7.0%) is in talks to buy specialty chemicals maker General Chemical Corp. from private equity firm American Securities LLC for as much as $1 billion. American Securities took General Chemical private for $673 million in 2009.
< br /> General Chemical makes a wide range of chemicals. In addition to water treatment and pharmaceuticals, its main markets include oil refining, pulp and paper, agriculture and food and beverage.
< br /> This would be a huge acquisition for Chemtrade, more than doubling its $706.4- million market cap. A major purchase like this can always backfire, but it would likely be a good fit, offering Chemtrade both growth prospects and diversification.
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ISHARES MSCI EMERGING MARKETS INDEX FUND $41.73 (New York symbol EEM; buy or sell through brokers) is an exchange traded fund that aims to track the MSCI Emerging Markets Index. Its geographic breakdown includes China, 18.6%; South Korea, 15.7%; Brazil, 11.6%; Taiwan, 11.3%; South Africa, 7.4%; Russia, 6.2%; India, 5.8%; Mexico, 5.2%; Malaysia, 3.7%; and Thailand, 2.5%.

The ETF’s top holdings are Samsung Electronics (South Korea), 3.7%; Taiwan Semiconductor (computer chips), 2.3%; China Mobile, 1.8%; China Construction Bank, 1.5%; Tencent Holdings (China: Internet), 1.5%; Industrial & Commercial Bank of China, 1.4%; Gazprom (Russia: gas utility), 1.4%; and America Movil (Brazil: wireless), 1.0%.

The fund’s industry breakdown is as follows: Financials, 26.8%; Information Technology, 14.8%; Energy, 11.7%; Materials, 9.8%; Consumer Staples, 8.8%; Consumer Discretionary, 8.8%; Telecommunication Services, 7.6%; and Industrials, 6.4%.
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LOBLAW COS. $45.67 (Toronto symbol L; Shares outstanding: 282.1 million; Market cap: $12.8 billion; TSINetwork Rating: Above Average; Dividend yield: 2.1%; www.loblaw.ca) has transferred the bulk of its real estate holdings to a new, publicly traded real estate investment trust called Choice Properties REIT, $10.10, Toronto symbol CHP.UN.

Loblaw sold a 16.9% interest in the REIT to the public in July 2013 as a new issue at $10. It kept 83.1% of Choice Properties’ units.

Choice owns 425 properties, including 415 supermarkets and shopping centres, nine warehouses and one office building. Ontario accounts for 43.2% of its earnings, followed by Quebec (17.8%), Alberta (13.1%), B.C. (7.7%), Saskatchewan (5.1%), Nova Scotia (4.6%), New Brunswick (3.9%), Manitoba (2.5%), Newfoundland (1.7%) and P.E.I. (0.4%).
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WYNDHAM WORLDWIDE $62.75 (New York symbol WYN; TSINetwork Rating: Extra Risk) (973- 753-6000; www.wyndhamworldwide.com; Shares outstanding: 133.0 million; Market cap: $8.3 billion; Dividend yield: 1.9%) is one of the world’s largest hospitality companies, with 7,410 franchised hotels worldwide.

In addition to hotels, Wyndham manages vacation resorts, rental properties, luxury clubs and time-shares....

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