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Alex RuusTibor Kolley/The Globe and Mail

Alex Ruus is portfolio manager at Arrow Capital Management. His focus is North American equities.

Top Picks:

Magna International (MG.TO) Last purchased on May 28 at $71

The world's third-largest auto parts provider with excellent growth prospects and an outstanding balance sheet. The company is undervalued by the market, trading at 10 times earnings, with a growing dividend, and continuing share buybacks.

Gilead Sciences (GILD.O) Last purchased on December 23, 2014 at $90

The world leader in providing medication for HIV and Hepatitis. The company is undervalued by the market, trading at 10 times earnings with a growing dividend, and continuing share buybacks.

Flyht Aerospace (FLY.V) Last purchased on June 3 at $0.25

The emerging world leader in flight information reporting, allowing airline customers to more efficiently monitor and control their valuable airplane fleets while generating cost savings that can be passed on to shareholders or to customers. The company recently reported its best quarter in history and has a record sales funnel. As an assembly line option on Airbus and other airplanes, sales are accelerating. The company trades at a fraction of its discounted free cash flow streams over the coming years.

Past Picks: June 16, 2014

Anthem (ANTM.N) Previously Wellpoint (WLP NYSE)

Then: $106.10; Now: $163.76; +54.35%; Total return: +56.11%

LyondellBasell Industries (LYB.N)

Then: $98.87; Now: $102.78; +3.95%; Total return: +7.08%

Neptune Technologies & Bioressources (NTB.TO)

Then: $2.67; Now: $1.68; -37.08%; Total return: -37.08%

Market Outlook:

We look for a continued slow economic recovery from the great recession of 2008-09. Look for the massive pullback in the price of oil to provide a stimulus to global economies as consumers have just received a large increase in disposable income as their energy bills drop. A growing global economy combined with attractive valuations provides the backdrop for a rising equity market, however disciplined security picking will be much more important to generating strong returns than in the last few years. The fundamentals of the companies in the Leaders portfolio are excellent and the outlook for the coming year is excellent to continue to outperform.

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