67 WALL STREET, New York - February 12, 2013 - The Wall Street Transcript has just published its Investing in Canada Report. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.
Topics covered: Investing in Canada - Long-Term Investing - Canadian Dollar Investing - Value Investing
Companies include: Wal-Mart Stores Inc. (WMT), Baytex Energy Trust (BTE), Canadian Natural Resources Lim (CNQ), The Bank Of Nova Scotia (BNS), Toronto-Dominion Bank (TD), Royal Bank of Canada (RY) and many others.
In the following excerpt from the Investing in Canada Report, two award winning asset managers discuss their methodology for selecting securities for their portfolios:
TWST: How about the financials? Are there one or two holdings you like in Canada?
Mr. Elliott: In terms of the banks in Canada, we like BNS (BNS) because it has global exposure and it is expanding outside of Canada. The other banks in Canada are essentially competing within the Canadian market, as a lot of them have downplayed their growth initiatives outside of Canada in recent years, due to concerns with what's been going on primarily in the U.S. banking industry. So they're competing more intensely against each other in a relatively small domestic market in Canada, which has historically compressed margins. I wouldn't consider the Canadian banks to be particularly exciting here, although they all pay solid dividends.
I think the mutual fund industry has sort of passed its best-before date. There's more competition from ETFs, fees are going down and margins should be heading lower in that industry, so we are not too excited about that either.
Ms. Throop: Although we do not look at financials for material growth, for somebody outside of Canada it is indeed a great way to get exposure to both the Canadian market and the Canadian dollar, as the Canadian banks are some of the best capitalized and have some of the best ROEs in the world. The ones we like and own are Bank of Nova Scotia, for its emerging market growth exposure and solid wealth management business; TD (TD), best platform in the U.S.; and Royal (RY), best capital markets exposure.
TWST: Are there any sectors or areas of investment that you're especially cautious about in today's environment?
For more of this interview and many others visit the Wall Street Transcript - a unique service for investors and industry researchers - providing fresh commentary and insight through verbatim interviews with CEOs, portfolio managers and research analysts. This special issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.