David Cockfield is managing director and portfolio manager at Northland Wealth Management. His focus is Canadian equities.
iShares North American Tech ETF
This ETF offers investors participation in a portfolio holding leading North American tech companies. The following is the recent weight in the portfolios of Apple – 8.5%, Microsoft – 7.6%, Google – 7.4%, IBM – 5.8% and Cisco – 3.8%. Ten of the top U.S. tech companies make up approximately 50 per cent of the portfolio. Various sectors are represented – software, IT services, internet software, computers and semiconductors make up approximately 80 per cent of the portfolio. Management fees are low at 0.48 per cent and the beta vs the S&P 500 is 1.01.
A leading Canadian entertainment company, Cineplex operates 161 theatres with 1,600 screens across Canada. The company has been highly successful in consolidating the industry by acquiring and upgrading theatre groups to make them more profitable. Old theatres with single screens have been restructured to have multiple screens and new multi-screen theatres built. Food services have been upgraded and expanded to improve profitability. The company has digitized its theatres and strives to be a leader in new entertainment technology. The yield of the stock is a respectable 3.39 per cent.
One of the largest Canadian chartered banks, TD has been successfully focused on the retail banking sector and is thus less dependent on fluctuating financial market earnings. TD over the last decade has acquired significant U.S. banking assets. These U.S. operations which TD continues to expand will likely produce better growth than can be expected in Canada. TD pays a dividend of 3.4 per cent and has a good record of increasing its dividend.
Past Picks: January 25, 2013
Crescent Point Energy Corp.
Then: $39.57; Now: $39.83; Total return: +8.09 per cent
Sprott Gold Bullion Fund
Then: $14.11; Now: $11.42; Total return: -19.09 per cent
SNC-Lavalin Group Inc.
Then: $44.88; Now: $48.17; Total return: +9.64 per cent
Total return average: -0.45 per cent
With U.S. political turmoil behind us and economic prospects brightening, financial markets have taken a positive tone. Bond markets absorbed the beginning of tapering without panic. North American equity markets have continued their upwards trends and are likely to do so for the near term. The TSX should be able to top the 14,000 mark in this quarter.