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Michael Sprung is president of Sprung Investment Management Inc.

Michael Sprung is president, Sprung Investment Management. His focus is Canadian large caps.

Top Picks:

Royal Bank of Canada (RY-TSX)

The Royal Bank is Canada's largest financial institution with extensive domestic and wealth operations as well as global capital markets, custody and brokerage networks. The positive results in the most recent quarter are illustrative of the strength of a well-diversified and managed company. Longer term, we expect Royal Bank to prosper and provide further dividend enhancements.

HudBay Minerals Inc. (HBM-TSX)

HudBay Minerals is one of Canada's leading producers of zinc, copper and precious metals with operations in Canada, Peru and the U.S. Constancia, a major copper-molybdenum-silver mine in Peru, will be ramping up production over 2015. With other projects coming on stream over the next few years, we anticipate that valuation levels will increase.

Aecon Group (ARE-TSX)

Aecon Group is one of Canada's largest construction companies. A large portion of Aecon's business is related to the energy sector and the company's stock price has been under pressure as a result. Over the last number of years, management has taken steps to strengthen the financial position of the company. At current prices, the stock presents good value to investors for longer term appreciation.

Past Picks: March 7, 2014

Cenovus Energy (CVE-TSX)

Then: $29.43; Now: $22.19 -24.60%; Total return: -24.69%

EnerCare Solutions Inc. (ECI-TSX)

Then: $10.71; Now: $14.71 +37.35%; Total return: +45.09%

Fortis Inc. (FTS-TSX)

Then: $30.63; Now: $38.55 +25.86%; Total return: +30.63%

Total return average: +17.01%

Disclosure:

Personal

Family

Portfolio/Fund

CVE

N

N

Y

ECI

N

N

Y

FTS

N

N

Y

Market outlook:

Geopolitical concerns (Ukraine/Russia, ISIS in the Middle East, etc.) are still prevalent but investors' concerns are becoming more focused on the fallout of weak oil prices, low inflation (possibly deflation) and weak demand for goods and services. The U.S. dollar continues to dominate currency markets reflecting the relatively strong fundamentals of the U.S. economy while the European and Japanese economies are weak and the growth in China has been less than expected. While low oil prices may ultimately benefit oil importing countries, oil exporters are feeling the pinch and Canada is no exception. As the impact of the weakening energy sector reverberates throughout the Canadian economy, the stock market in Canada will continue to exhibit higher volatility for the next number of months. During this period, investors would be well advised to position their portfolios in companies with strong financial positions that will weather the storm and ultimately benefit from the opportunities presented by weaker companies' distress.

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