The moment

Aug 25 20:08 2019 Print This Article

Elke “Wieselblitz” Vogelsang photo


By coincidence, not design (honest), the last two posts told you not to set your pants on fire, remain calm, go for a tummy rub and be a long-term thinker instead of a timorous chicken. How’s that for mixed images? But you know what I mean. Just chill. Especially this week. It could be a stinker.

My colleagues Sinan (he was vice-president of RBC Capital Markets in New York City) and Doug (a veteran portfolio manager and Bay Street analyst) had a simple message: stay invested. The storm will pass. It’s not actually different this time. Emotional decisions have poor consequences. The headlines are more dire than reality. We are not going over a cliff. Just for a ride.

Am I making any changes to the BD portfolio that Dorothy, Bandit and I share? Not a chance. The bonds will go up as the equities go down. And later the equities will recover and the bonds fade. The overall volatility will be contained for having 40% in fixed income, with the growth assets spread between Canada, the US and overseas markets, plus some real estate trusts thrown in for more diversification. The preferred shares have lost capital value as rates decline, but who cares? The dividend is great at 4.95% (plus a tax credit) and I’m not cashing them in, so the market value is moot.

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About Article Author

Greater Fool

Author, Garth Turner has been a member of the Canadian Parliamant for nine years, serving as Member of Parliament, Cabinet Minister (in charge of Canada Revenue Agency), national leadership contender (Progressive Conservative Party of Canada), House of Commons Standing Committee member and chairman (Consumer and Corporate Affairs, Finance), Special Advisor to the Leader of the Official Opposition. He is a member of the Privy Council of Canada. In addition, Garth is an ambitious entrepreneur – founder and CEO of Canada’s largest independent producer of network television, providing programming to CTV, Global, YTV and others. He founded and successfully operated chain of six community newspapers in Ontario as well as founded and operated eco-tourism and hospitality company aggregating and restoring heritage properties.

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