royal bank
The profitability of banks is determined by a variety of factors including their business mix, lending profit-margins, loan and deposit growth, bad debts, and cost management. The top-performing banks consistently find the right balance between these factors, leading to strong results and stock market performance.
Lending margins drive profits
A key driver of bank profits is their net interest margins—that’s the difference between the interest rate that a bank charges on loans it issues and the interest rate that it pays to depositors and other providers of funds to the bank.
In a rising interest rates environment, banks normally manage to increase their net interest margins—as long as the increase in the cost of funding lags the higher pricing of their loans to customers.
Banks that derive a large portion of their revenues from their lending activities benefit relatively more from improving their lending margins....
Lending margins drive profits
A key driver of bank profits is their net interest margins—that’s the difference between the interest rate that a bank charges on loans it issues and the interest rate that it pays to depositors and other providers of funds to the bank.
In a rising interest rates environment, banks normally manage to increase their net interest margins—as long as the increase in the cost of funding lags the higher pricing of their loans to customers.
Banks that derive a large portion of their revenues from their lending activities benefit relatively more from improving their lending margins....
Banks and other financial services firms suffered in early 2020 as the pandemic took hold. But most have since bounced back—and many have hit new highs. Meanwhile, once economic activity returns to normal, the best of these should continue to be strong performers....
BMO COVERED CALL CANADIAN BANKS ETF $23.26 (Toronto symbol ZWB) holds shares of Canada’s six largest banks (CIBC, TD Bank, Bank of Montreal, Bank of Nova Scotia, Royal Bank and National Bank).
The fund started up in January 2011....
The fund started up in January 2011....
In addition to the top picks for 2022 and beyond that we feature this issue (including our #1 pick), we recommend the following three ETFs. All are poised to move up this year and to help you tap key market segments. For myriad reasons (see the Supplement on pages 19 and 20), each of the funds could significantly add to your 2022 returns.
First, we still feel that virtually all Canadians should have, say, 20% to 30% of their portfolio in U.S....
First, we still feel that virtually all Canadians should have, say, 20% to 30% of their portfolio in U.S....
TORONTO-DOMINION BANK $86 is a buy. The lender (Toronto symbol TD; Conservative Growth and Income Portfolios, Finance sector; Shares outstanding: 1.8 billion; Market cap: $154.8 billion; Price-to-sales ratio: 3.6; Dividend yield: 3.7%; TSINetwork Rating: Above Average; www.td.com) is Canada’s second-largest bank by market cap after Royal Bank (see page 101).
TD has entered into a new agreement with Envestnet, Inc....
TD has entered into a new agreement with Envestnet, Inc....
BMO COVERED CALL CANADIAN BANKS ETF $20.73 (Toronto symbol ZWB) holds shares of Canada’s six largest banks (CIBC, TD Bank, Bank of Montreal, Bank of Nova Scotia, Royal Bank and National Bank) either directly or through units of the BMO Equal Weight Banks Index ETF.
The fund started up in January 2011....
The fund started up in January 2011....
We continue to have a high opinion of recommend all of Canada’s top banks, but Bank of Nova Scotia remains one of our top favourites for new buying. That’s mainly because it has the greatest international exposure of the five—it now gets roughly 40% of its revenue from international operations (especially the four countries it calls “the Pacific Alliance”—Mexico, Peru, Chile and Colombia)....
Canada’s banks continue to rebound strongly from last year’s COVID-19 lows; rising vaccination rates are letting more businesses re-open, which further fuels stock gains. Consumers also continue to repay their loans on time.
We like all of the Big Five banks, but TD stands out thanks to its strong retail banking operations in Canada and the U.S....
We like all of the Big Five banks, but TD stands out thanks to its strong retail banking operations in Canada and the U.S....
Over the last few years, more and more ETF managers have launched funds focused on taking environmental, social, and governance (ESG) factors into account.
Sustainable investing offers some investors a lot of conceptual and emotional appeal. But does investing in these kind of stocks hurt your portfolio returns? Yes and no.
One way investing in sustainable ETFs can hurt performance is the ethical criteria used by some funds to select stocks could keep you out of promising investments with the power to boost your long-term portfolio returns....
Sustainable investing offers some investors a lot of conceptual and emotional appeal. But does investing in these kind of stocks hurt your portfolio returns? Yes and no.
One way investing in sustainable ETFs can hurt performance is the ethical criteria used by some funds to select stocks could keep you out of promising investments with the power to boost your long-term portfolio returns....
As we’ve often pointed out, IPOs tend to come to market when it’s a good time for the company or its insiders to sell. That may not be, and often isn’t, a good time for you to buy.
One common problem is that the IPO sales process drums up a temporary wave of buying that can push up the stock’s price....
One common problem is that the IPO sales process drums up a temporary wave of buying that can push up the stock’s price....