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Madams Advisory Group

  • Home
  • About us
    • Our team
    • Our partners
  • Why us
    • Our values
    • Our process
    • Client case studies
    • Testimonials
  • Portfolios
  • Market insights
    • Market viewpoint
    • Video
  • Resources
    • When to Consider a Wealth Management Team
    • Financial Steps to Consider During Divorce
    • A Guide to Planning
  • Contact us

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Equity investing: Lessons learned and current opportunities

Colum McKinley, CIO, Global Equities, CIBC Asset Management, discusses the importance of dividends, and why he sees current value in Canadian banks and REITs.

 

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.]

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.]

Back to Video
 

How to stay balanced in volatile markets

While the current volatility is unsettling, it’s important to remain calm and focus on the long term. Craig Jerusalim, Senior Portfolio Manager, CIBC Asset Management, provides insights on navigating the current market situation.

 

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.]

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.]

Back to Video
 
 
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CIBC Private Wealth” consists of services provided by CIBC and certain of its subsidiaries through CIBC Private Banking; CIBC Private Investment Counsel, a division of CIBC Asset Management Inc. (“CAM”); CIBC Trust Corporation; and CIBC Wood Gundy, a division of CIBC World Markets Inc. (“WMI”). CIBC Private Banking provides solutions from CIBC Investor Services Inc. (“ISI”), CAM and credit products. CIBC Private Wealth services are available to qualified individuals. Insurance services are only available through CIBC Wood Gundy Financial Services Inc. In Quebec, insurance services are only available through CIBC Wood Gundy Financial Services (Quebec) Inc.


CIBC Private Wealth services are available to qualified individuals. The CIBC logo and “CIBC Private Wealth” are trademarks of CIBC, used under license.