Transcript: Are Negative Oil Prices the New Normal? [Soft Music playing in background] [Title reads: Are Negative Oil Prices the New Normal?] [Onscreen Text: April 27, 2020] [Onscreen Text: Brian See, Portfolio Manager, Global Equities, CIBC Asset Management]   So when we see oil at zero or in fact negative pricing, it's really a function of too much supply in the oil market and not enough demand. And then compounded by the fact that there's really no place to store the oil. And when this happens, oil prices will effectively go no-bid, which is what we witnessed when oil prices traded at negative $37/barrel. So when the markets go through this painful price discovery, it's really a function of these futures oil contracts being unwound prior to contract expiration. And so what we mean by that is the financial holders of these contracts, they're looking to sell their positions toward the end of the month to avoid taking actual physical delivery of oil.   [Still image of an oil tanker navigating across a sea.]   And in previous cycles in the past, refiners and storage operators would be buyers of this crude. But because of their fears of crude approaching full storage capacity, they end up not purchasing it at all.   [Still image of two technicians walking through an oil refinery, followed by an aerial image of a large oil refiney.]   And then these oil contracts end up pricing to whatever is necessary in order to sell them.   [Soft Music playing in background] [Title reads: OPEC matters]   So at the latest OPEC meeting, which was an emergency meeting held between Saudi and Russia to get everyone back to the negotiating table, the OPEC plus delivered a historic deal, cutting 9.7 million barrels out of the market. Now, when we look at the numbers, the devil's in the details because the 9.7 million barrels a day cut is really only for two months, for May and June. After that, that cut actually falls to 7.7 million barrels for the balance of 2020. Starting in 2021 and all the way out to April 2022, that cut further falls to 5.8 million barrels a day. Now it's still a historic cut by any means, given the amount of production taken off the market.   [Still image of an offshore oil rig.]   And it truly helps in helping balance the overall supply markets. In addition, other oil producing nations such as the U.S., Canada and Brazil have also voluntarily cut production.   [Still image of a crew of workers at an oil derrick, followed by a still image of a single oil derrick on a snowy plain, followed by a still image of a single oil derrick on a wide, rolling green plain, followed by a still image of a long row of oil transport train cars.]   And this is really stemming from the fact that it's not only uneconomic to produce to the oil, but there's simply no place to store it.   [Soft Music playing in background] [Title reads: Impact on Canadian oil companies]   With low prices and what it means for Canadian oil companies is that solvency and liquidity are going to be the most important things in an environment of extreme price dislocation. So this means that Canadian oil companies and other global oil companies are going to have to be making sure that they can access cash, credit facilities or any debt on hand and really any other forms of cash in order to be able to ride out this volatile time. That's the most important thing. The second thing is production shut-in economics: companies are going to have to assess their assets and their various plays in order to decide which production has to be shut-in in order to preserve the balance sheet and the financial viability of the company.   [Soft Music playing in background] [Title reads: Where are oil prices headed?]   So when you look at depressed oil prices, it's really a combination of COVID and OPEC. When you're actually looking at oil, it's really facing a black swan event where you had an initial price war resulting in an oversupplied market, which was further exacerbated by the fact that the Corona virus wiped out 20 to 30 million barrels of oil demand at its peak.   [Still image of a large stack of oil barrels, followed by a still image of a man wearing a germ mask on a city street, followed by a still image of a rural gas station with a single truck at the pumps.]   When you look at that at its peak, this results in 2020 being the first year of negative oil demand since the global financial crisis.   [Still image of a set of unused gas pump nozzles, followed by a still image of a super highway being used by a single car, followed by a still image of a city highway with no cars.]   And so when you combine the OPEC cut of 9.7 million barrels a day versus the 20 to 30 million barrels a day of demand destruction, it's simply not enough to overcome weak prices in the short term. And ultimately, even with other countries moderating, the short term, prices are going to continue to be under pressure.   [Soft Music playing in background] [Title reads: Will oil demand return?]   So things will look better for oil once Canada's economy starts to pick up. But this is also dependent upon the US economy. It's important to note that Canada produces about 4 million barrels of oil and seventy five percent of this is actually exported to United States. And so the good news out of this is the US is actually demanding a lot of the heavy oil that Canada produces, and this is to replace their dwindling supplies from Mexico and Venezuela. In addition, the US has goals of oil independence and less reliance on foreign oil, such as coming from the Middle East and Africa, and this makes Canada also an attractive substitute. So in the long term, Canada's still better positioned for this. It's just going to take time for supply and demand to moderate and balance.   [Soft Music playing in background] [Title reads: Longer term oil outlook]   If we look in the long term and approximately about two to three years out per se, we're going to see this as a tremendous buying opportunity in today's markets for a couple of reasons. Number one, demand will eventually return to historical levels, post-COVID. We're already seeing early trends of less cases and fatalities, and the data seems to be trending in the positive direction. The second thing is the OPEC supply cuts and overall voluntary production curtailments are going to be effective all the way until 2022. So that's a lot of supply taken off of the market. In addition, there's also a lack of investment by the industry. And this is going to result in a supply crunch eventually down the road a few years later. Ultimately, when you combine that all together and assess our supply and demand fundamentals and marginal cost economics, we see oil prices going from effectively no-bid or very low prices today to somewhere in the realm of 40 to 50 dollars, which we view as the fair value for long term oil prices.   [Soft Music playing in background] [Disclaimer: The views expressed in this video are the personal views of Brian See and should not be taken as the views of CIBC Asset Management Inc. This video is provided for general informational purposes only and does not constitute financial, investment, tax, legal or accounting advice nor does it constitute an offer or solicitation to buy or sell any securities referred to. Individual circumstances and current events are critical to sound investment planning; anyone wishing to act on this video should consult with his or her advisor. All opinions and estimates expressed in this video are as of the date of publication unless otherwise indicated, and are subject to change.   ®The CIBC logo is a registered trademark of CIBC, used under license. The material and/or its contents may not be reproduced without the express written consent of CIBC Asset Management Inc.   Certain information that we have provided to you may constitute “forward-looking” statements. These statements involve known and unknown risks, uncertainties and other factors that may cause the actual results or achievements to be materially different than the results, performance or achievements expressed or implied in the forward-looking statements.]

 

Equity Investing: Lessons Learned & Current Opportunities

 

[Soft music playing in background]

[Title reads: Equity Investing: Lessons Learned & Current Opportunities]

[Onscreen Text: April 9, 2020]

[Onscreen Text: Colum McKinley, CIO, Global Equities, CIBC Asset Management]

 

Global economies, financial markets, even our own daily lives are experiencing substantial disruption as a result of COVID-19. The world is coping with a significant and important issue. As long-term investors we want to obsessively worry about the risks in the near-term but remember the important lessons of financial history. And history has shown us over and over again that these periods of uncertainty, volatility, and angst ultimately, in the fullness of time, appear to be buying opportunities.

 

[A still image of people walking on a city street wearing masks, follow by a sign on a store door that reads ‘we are closed’, followed by an image of a US dollar bill with president wearing a mask, followed by a black and white image of depression-era people gathered together, followed by an image of a man standing in front of a wall-sized graphic showing changes in the stock market.]

 

I am very fond of Buffett’s old adage to “be greedy when others are fearful”. Fear remains very high today. We expect that in the coming months economic data and corporate operating results will deteriorate substantially. In meetings with business leaders they’re telling us that visibility in the near-term remains low. If we stopped there then this would be a bleak story but positives are happening in the background that should be providing investors hope for the longer-term. The battle against covid-19 continues to focus on flattening the curve, or slowing the growth of the number of new cases reported each day.

 

[A still image of a masked woman in a medical lab putting a liquid solution into a beaker, followed by an image of a mother and child, each wearing masks, and applying hand sanitizer, followed by an image of a man washing his hands.]

 

An important positive is the adoption of self-isolation or quarantine that is occurring around the world.

 

[A still image of a masked young woman staring out her window, followed by an image of a masked young child looking out his living room window, holding a sign that reads ‘#stayathome’.]

 

We have witnessed that strategy deliver results in other countries. Even now we are starting see progress in flattening the curve in many countries around the world.

 

[A still image of a hospital room, with a patient lying in a bed, being shown information to him on a tablet by his doctor.]

The great personal sacrifice we are all making is working. We continue to monitor this closely and we expect to eventually see a thawing of the restrictions and constraints on the broader economy. At the same time, central banks and governments have unleashed an unprecedent amount of stimulus into the economy.

 

[A still image of the Legislative Assembly of Ontario building, followed by an image of the Bank of London, followed by an image of the US Federal Reserve.]

 

In fact, they continue to demonstrate through their actions that they are prepared to do anything and everything needed to backstop the economy and provide liquidity into the financial system.

 

[A still image of a sign reading ‘Wall St.’, followed by a close-up image of Wilfrid Laurier’s face on a $5 bill.]

 

Once we get back to our normal lives, an incredible amount of pent up demand will exist. The stimulus and liquidity support will help the economy quickly regain its footing.

 

[A still image of a crowd at a concert, followed by an image of three men watching a soccer game at a sports bar, followed by an image of a happy group of people at a restaurant.]

 

In the midst of the crisis, investors are best to consider the old Gretzky advice of “skating to where the puck is going to be”. While calling a market at bottom is always difficult, we remain confident that looking out a year or two from now we’ll reflect back on today’s prices as a buying opportunity. And we want to ensure that we use this volatility and crisis to our advantage.

 

[Soft music playing in background]

[Title reads: Importance of dividends]

 

It’s in times like this that we are reminded of the importance of dividends to equity investors. Dividends are an incredibly significant source of return for equity investors. In the ten years ended December 31, 2019, the compound annual total return of the S&P/TSX Composite index was 6.9%. Approximately half of that total return was attributable to dividends. For equity investors, dividends represent the proverbial bird in hand. As markets have fallen, yields have increased. Many of the best companies in Canada today are providing yields in the high single digits. Buying today allows us to lock in these yields. This is very similar to the opportunity that existed in the global financial crisis. Banks have traditionally been a source of attractive dividends for Canadian investors. They have diversified businesses, they have strong management teams, and solid capital positions. They are expected to be a continued source of strong dividends for investors. In the near-term, bank earnings will be clearly challenged. Banks are a levered play on the economy. And as we witness the short-term deterioration of the economy, it’ll affect the profitability of these businesses. As a result, their dividend payout ratios will rise. Again, turning to history as a useful guide to today’s environment: since 1980, payout ratios rose above 100% only two times. The first was in 1987 when the big six reported negative earnings. And the second in 1992 when earnings declined by 60%. In both those periods the big six did not cut their dividends. In our analysis of the banks we have generated meaningfully stressed scenarios. We expect that the banks will be able to maintain their current dividends. And for investors that provides a stable and attractive dividend in a low bond yield environment. In addition, investors will benefit from the capital appreciation once markets and economies stabilize.

 

[Soft music playing in background]

[Title reads: Real Estate Investment Trust Units (REITs)]

 

Another source of attractive yield and an area of opportunity today is the REITs. Real Estate Investment Trusts own a variety of buildings and property, including apartments, offices, retail malls, and industrial units.

 

[A still image of a building under construction, followed by an image of a row of apartment buildings, followed by an image of a condo, followed by an image of an industrial shipping building.]

 

These are hard assets that are foundational to the economy.

 

[An image of a happy family sitting at their front porch.]

 

In addition, the cashflows are governed by contractual relationships in the form of leases.

 

[A still image of a close-up of a person putting their signature on a contract, followed by an image of a couple signing a lease.]

 

Over the last ten years to December 31, 2019, the S&P/TSX real estate sub-index has outperformed the composite, delivering a total return of 10.3%. Much like other parts of the market, these stocks have experienced substantial volatility recently.

 

[A graph shows the S&P/TSX Real Estate Sub-index on a monthly basis from 2010 until now. It shows a steady rise over that period, from 1500 points to 4000 points, until a recent, very sharp decline to 2000 points.]

 

This is creating opportunities. In today’s environment, REIT operating results will be affected. REITs are working with their tenants to provide relief in the short-term. Many are reducing or outright deferring rents for 2 – 3 months. As long-term investors, we look at these buildings that will provide monthly cash flow for 50, 60 years or more. 50 years is 600 monthly payments. While reducing or foregoing 2 or 3 months in the near-term will effect their short-term results it doesn’t meaningfully have changed the long-term value of these buildings. Yet recently REIT valuations have declined meaningfully, with many down in excess of 40% from their highs. In today’s environment they’re providing dividend yields in the high single digits, and very very attractive valuations for solid businesses.

 

[Soft music playing in background]

[Title reads: Attractive valuations]

 

Our portfolios are made up of high quality, blue chip businesses. Today, we are seeing the opportunity to add to these businesses at very attractive valuations. Our continued work and recent conversations have left us with higher conviction of the ability of these companies to navigate and survive this uncertainty. We know from past experience we will at some point look back at the current world as a buying opportunity. We continue to be ever vigilant about managing risks while ensuring that we don’t waste this crisis and the opportunity that it is presenting.

 

[Soft music playing in background]

 

[Disclaimer: The views expressed in this video are the personal views of Colum McKinley and should not be taken as the views of CIBC Asset Management Inc. This video is provided for general informational purposes only and does not constitute financial, investment, tax, legal or accounting advice nor does it constitute an offer or solicitation to buy or sell any securities referred to. Individual circumstances and current events are critical to sound investment planning; anyone wishing to act on this video should consult with his or her advisor. All opinions and estimates expressed in this video are as of the date of publication unless otherwise indicated, and are subject to change.

®The CIBC logo is a registered trademark of CIBC, used under license.

The material and/or its contents may not be reproduced without the express written consent of CIBC Asset Management Inc.

Certain information that we have provided to you may constitute “forward-looking” statements. These statements involve known and unknown risks, uncertainties and other factors that may cause the actual results or achievements to be materially different than the results, performance or achievements expressed or implied in the forward-looking statements.]

How to Stay Balanced in Volatile Markets

[Soft music plays]

 

[Onscreen Text: Craig Jerusalim, Portfolio Manager, Canadian Equities, CIBC Asset Management]

 

Craig: Markets are really experiencing some unprecedented moves right now. The drop in oil, 20 to 30 percent in one day. The drawdown in the broad indices is really unprecedented in the scale and the speed of which it's dropped. And the problem right now is no one can give definitive answers, definitive answers of when the Coronavirus is going to be cured or when the imminent recession is going to come or not come. And it's really that fear of the unknown that is causing some market participants to panic. And there's no answer that I can give to fully allay fears of an imminent V-shaped bounce back, because no one knows for certain that that's what's going to happen.

 

Advice for clients really has to be in line with what you feel comfortable, what risk you feel comfortable taking on. However, don't try and time the market. All the evidence we've seen over history is that investors are really poor at getting out as the market is dropping and then getting back in when the market's rebounding. There's really only one mistake an investor can make throughout the history of investing, and that's selling at the bottom. If you miss just the 20 best days over the past 20 years, you would've wiped out 100 percent of your returns over that time period for the TSX. So instead, be comfortable with your asset allocation and be able to perhaps either dollar cost average in or dollar cost average out to help alleviate some of those fears.

 

[Onscreen Title: The importance of long-term investing]

 

Craig: Today's market price is probably not the low, tomorrow's low probably won't be the cycle low either, but we don't know when that rebound is going to happen. And there are a number of differences between the situation today and the situation in 2009, for example, during the financial crisis.

 

Today, there's a factor, the Coronavirus, that is causing people to just tighten up and cause people to not go out and spend, not travel. And that's causing a short-term demand impact. However, unlike in 2008 and 2009, there's not massive fraud in the system. There's not excesses in valuations or any bubbles forming. The U.S. consumer, for example, is much healthier today than they were in 2008. Saving rates are high. Debt service ratios are low. Unemployment is extremely low. So, there's reasons to believe that there's going to be some sort of built up demand that will come back to the market when those fears alleviate. We also know that interest rates are extremely low at all-time record lows and that the federal government is there for monetary and fiscal stimulus, as well as many other countries around the world that are going to be throwing everything they can at this economy to get it moving again. We don't know when that's going to happen, but we know we want to be positioned for it. So, we're not throwing out the babies with the bathwater or using the opportunity to high-grade portfolios to move to the highest quality companies, to be best positioned for that rebound when it happens.

 

[Onscreen Title: Portfolio positioning]

 

Craig: There's two sets of assets that we need to think about. The asset where the allocation is a little bit more flexible, where you could raise cash and you can move more defensive. And there's another set of assets that are going to stay fully invested. And that's the money that we're managing for clients, for the money that's staying fully invested in mutual funds, for example, we're not sitting on our hands and doing nothing.

 

[Onscreen Text: Five indicators we are watching in our portfolios]

 

Craig: There's five things that we're doing within those funds.

 

[Onscreen Text: 1. Look at company balance sheets]

 

Craig: The first is looking at balance sheets. Any company that is at risk in the short term, due to their leverage, is something that needs to be taken out of the portfolios. We have to be invested in the companies that can use this market disruption to their advantage as opposed to it causing risks from an ongoing basis.

 

[Onscreen Text: 2. Identify potential switch trades]

 

Craig: The second thing is we're looking for switch trades, which companies with similar exposures are down more than others because right now everything is moving lower. But at different paces. So, we're looking for the switch trades in the portfolio.

 

[Onscreen Text: 3. Look for overreaction in company shares]

 

Craig: The third thing is we're looking for companies that have just overreacted: which companies have are discounting a worst case scenario, recession, even though the cash flows are still recurring and ongoing.

 

Craig: The fourth is we're looking for the opportunities in the companies that have recurring earnings, that have domestic focused earnings, because we think that Canada is going to be less impacted than some other emerging markets around the world. We're looking for the companies that we know where their next dollar is going to come from. Think about all the companies whose bills you receive every month that you're going to continue to pay. Those are the telcos and the utility companies.

 

Craig: We're starting to sharpen our pencil on those cyclical companies. The companies that are down the most now but are likely to snap back at the time when the stimulus and the recovery begins. We're too early at this stage, but sharpening the pencil and getting ready for that rebound is important.

 

[Onscreen Text: The views expressed in this video are the personal views of Craig Jerusalim and should not be taken as the views of CIBC Asset Management Inc. This video is provided for general informational purposes only and does not constitute financial, investment, tax, legal or accounting advice nor does it constitute an offer or solicitation to buy or sell any securities referred to. Individual circumstances and current events are critical to sound investment planning; anyone wishing to act on this document should consult with his or her advisor. All opinions and estimates expressed in this document are as of the date of publication unless otherwise indicated, and are subject to change. ®The CIBC logo is a registered trademark of the Canadian Imperial Bank of Commerce (CIBC), used under license. The material and/or its contents may not be reproduced without the express written consent of CIBC Asset Management Inc. Certain information that we have provided to you may constitute “forward-looking” statements. These statements involve known and unknown risks, uncertainties and other factors that may cause the actual results or achievements to be materially different than the results, performance or achievements expressed or implied in the forward-looking statements.]

Transcript: 2019 Year End Tax Tips

Author: Jamie Golombek

Subject: Year-end tax tips and suggestions

Keywords:

 

[Soft Music Plays]

 

[Onscreen Text: Jamie Golombek, Managing Director, Tax and Estate Planning, CIBC Financial Planning and Advice]

 

[Image: Jamie Golombek is speaking directly to camera in front of a white background]

 

Hard to believe, but it's that time of year again, time from some year-end tax planning. Let's take you through some of the top issues that individuals might want to consider as we approach the end of the year.

 

[Onscreen Text: Tax-loss selling involves selling investments at year end

to offset capital gains elsewhere in your portfolio]

 

First of all, let's start with year-end tax-loss selling. Tax-loss selling is when you sell investments with accrued losses at the end of the year to offset gains realized elsewhere in your portfolio. Any losses that you currently don't use can be carried back three years to recapture capital gains tax paid in those three years or carried forward indefinitely to offset capital gains in future years.

 

[Onscreen Text: For the loss to be available in 2019, the settlement must take place in 2019]

 

For your loss to be available for 2019, however, you've got to make sure the settlement takes place in 2019.

 

[Onscreen Text: That means the trade date must be no later than Dec. 27, 2019]

 

That typically means that the trade date must be no later than December 27^th, 2019 so that the trade settles by December 31, taking into account the intervening weekend.

 

[Onscreen Text: For securities bought in a foreign currency, consider the exchange rate when computing the gain or loss]

 

Also, keep in mind that if you purchased securities in foreign currency, you've got to compute the gain or loss in taking into account the foreign exchange component, which means in some cases a gain may be a loss or a loss may be a gain depending on the timing of when you bought the security and the movement of the foreign exchange during that period.

 

[Soft Music Plays]

 

[Onscreen Title: Superficial loss rules]

 

Always be mindful when doing year-end tax loss selling of the superficial loss rule, which says that if you sell a security with a loss and you buy it back or an affiliated person buys it back—affiliated means a spouse, a partner, corporation controlled by a spouse or partner, even a RRSP or TFSA, buys it back within 30 days after the day of sale, then that loss can be denied and is added to your ACB, your adjusted cost base.

 

[Soft Music Plays]

 

[Onscreen Title: Delay certain RRSP withdrawals]

 

You may also wish to be strategic about certain registered plan withdrawals.

 

[Onscreen Text: Delay RRSP withdrawals under the HBP or LLP until 2020]

 

So, for example, if you take out money from an RRSP, maybe under the Homebuyer's Plan or the Lifelong Learning Plan, you may want to delay that withdrawal slightly into the beginning of 2020 rather than take it out towards the end of 2019. That'll give you an extra year before you have to begin repaying the annual amounts.

 

[Soft Music Plays]

 

[Onscreen Title: Timing of TFSA withdrawals]

 

On the other hand, when you're taking money out of a TFSA, you may wish to withdraw the money in 2019 rather than waiting till 2020 because that gives you extra time to put the money back.

 

[Onscreen Text: Consider TFSA withdrawals in 2019, which gives you more time to put the money back]

 

In other words, you could put the money back in immediately the following year, 2020, instead of waiting until 2021.

 

[Soft Music Plays]

 

[Onscreen Title: Convert your RRSP to a RRIF by age 71]
 

[Onscreen Text: For people turning 71 in 2019, you have until Dec. 31 to make your final RRSP contribution]

 

For individuals who turned seventy-one and 2019, you've got only until December 31 to make that final RRSP contribution. You don't have until the normal RRSP deadline, which is March 2.

 

[Onscreen Text: You may also be interested in making a one-time over contribution to your RRSP in December 2019]

 

You might be interested, also, in making a one-time over contribution to your RRSP in the month of December 2019. You would do that if, for example, you had earned income in 2019 that will generate contribution room for 2020—but, because you can't have an RRSP in 2020 because it'll be over seventy-one, you over contribute in December 2019, pay a bit of a penalty tax of 1% for that one month of December 2019, but Jan 1st 2020 new RRSP room opens up, and therefore allows you to deduct that amount starting in 2020 or a future year.

 

[Onscreen Text: After age 71 you may be able to use your contribution room for a younger spouse or partner]

 

Now that may not be necessary if you've got a younger spouse or partner because you can still use your room after 2019 to continue to make spousal or partner RRSP contributions until your spouse or partner is age 71.

 

[Soft Music Plays]

 

[Onscreen Title: Families with students]

 

[Onscreen Text: Consider making RESP contributions]

 

Other things to think about: well, for families with students, think about our RESP contributions.

 

[Onscreen Text: You don’t want to miss out on the 20% Canada Education Savings Grant (CESG) for the first $2,500 of annual RESP contributions]

 

You don't want to miss out on the free 20 percent of Canada Education Savings Grant of twenty-five hundred dollars of annual RRSP contributions. And if you've got a beneficiary who turned sixteen this year, you got to be very careful because they may lose the opportunity to get the maximum government grants. If you haven't already contributed to an RESP.

 

[Soft Music Plays]

 

[Onscreen Title: Family members with disabilities]

 

[Onscreen Text: The non-refundable Home Accessibility Tax Credit (HATC)]

 

[Onscreen Text: Helps seniors and those with a disability with certain home renovations]

 

The non-refundable Home Accessibility Tax Credit for seniors and Individuals with a disability tax credit, can help them with certain home renovations.

 

[Onscreen Text: That credit is worth 15% on up to $10,000 worth of expenses]

 

That credit is worth fifteen percent on up to ten thousand dollars of expenses. That applies to any payments made by December 31 for any work or goods acquired in 2019. That might be something to consider before the end of the year.

 

[Onscreen Text: Contribute to a Registered Disability Savings Plans (RDSP)]

 

RDSP, The Registered Disability Savings Plan, allowing an individual eligible for disability tax credit to get significant government grants and bonds.

 

[Onscreen Text: Consider contributing before year-end to get the 2019 grants and bonds]

 

You may want to contribute before the end of the year to get the 2019 grants and bonds.

 

[Soft Music Plays]

 

[Onscreen Title: Make donations in-kind]

 

When it comes to charitable giving, I often talk about tax gain donating.

 

[Onscreen Text: For securities that have appreciated in price, consider donating them in-kind to a registered charity before year-end]

 

If you've got some appreciated securities in your portfolio that have gone up, consider donating them in-kind to red to charity before the end of the year. Not only do you get a tax receipt for the fair market value of that gift, but you will also pay no capital gains tax on the particular gain on the security that's being donated in-kind to charity.

 

[Soft Music Plays]

 

[Onscreen Title: Individuals with changes to tax rates]

 

And finally, if you expect your tax rate to be different in 2020, you may want to plan, to the extent possible, the timing of various deductions and income inclusions.

 

[Onscreen Text: If you expect a different tax rate in 2020, consider timing of various deductions and income inclusions]

 

So, for example, if you have an opportunity to exercise stock options or trigger gain by selling an investment in 2019, depending on your tax rate this year versus next year, you might consider whether or not it makes sense to either realize those gains this year or take them in 2020 depending on the change in your own personal tax rate.

 

[Soft Music Plays]

 

[Onscreen Text: CIBC financial advisors provide general information on certain tax, investment and estate planning matters; they do not provide tax, accounting or legal advice. Please consult your personal tax advisor, accountant, licensed insurance professional and qualified legal advisor to obtain specialized advice tailored to your needs.

This video is provided for general informational purposes only and does not constitute financial, investment, tax, legal or accounting advice nor does it constitute an offer or solicitation to buy or sell any securities referred to. Individual circumstances and current events are critical to sound investment planning; anyone wishing to act on this document should consult with his or her advisor. All opinions and estimates expressed in this video are as of the date of publication unless otherwise indicated, and are subject to change. ^®The CIBC logo is a registered trademark of Canadian Imperial Bank of Commerce (CIBC). The material and/or its contents may not be reproduced without the express written consent of CIBC.]