John Hood is president and portfolio manager at J.C. Hood Investment Counsel. His focus is options and ETFs.
BMO Equal Weight US Health Care Hedged to CAD Index ETF (ZUH-TSX)
BMO NASDAQ 100 Equity Hedged To CAD Index ETF (ZQQ-TSX)
iShares Core S&P 500 Index ETF (CAD-Hedged) (XSP-TSX)
XSP and ZQQ are core holdings purchased over several years at different prices, focusing on the U.S. dollar hedged equities due to weakness in Canadian dollar. It's not that I expect weakness in the U.S. dollar but rather the Canadian dollar could spike when oils climb.
Past Picks: January 31, 2014
Vanguard FTSE Europe ETF (VGK-NYSE)
Then: $56.11; Now: $55.12 -1.76%; Total return: +2.39%
Vanguard Large-Cap ETF (VV-NYSE)
Then: $81.98; Now: $96.63 +17.87%; Total return: +20.06%
Horizons Floating Rate Bond ETF (HFR-TSX)
Then: $10.18; Now: $10.14 -0.39%; Total return: +1.78%
Total return average: +8.08%
I continue to be bullish on the U.S. and have been for several years with recent buys in the health-care and technology sectors, both in U.S. and Canadian funds. I am looking at getting back into Europe – not just euro members, but I'm still waiting to see how both "Grexit" and Putin's aggressiveness play out. Putin clearly won the so called "ceasefire" in the Ukraine as there is no withdrawal date for Russian troops, which he continues to insist are not present.
With respect to Canadian markets however, I am less than enthusiastic. The TSX remains near its highs which I doubt is sustainable. I continue to like Covered Calls on Canadian banks ZWB and would look at buying Canadian oils for more aggressive portfolios, but otherwise I might be taking a little (20 per cent) of the TSX broad indexes off the table in accounts with sizable gains. A lower dollar benefits exporters but I doubt that will compensate for the loss of revenue and taxes from the oil sector.