Strategy Blog


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A New Tactic For Adding U.S. Exposure

Highlights

This macroeconomic view provides our top-down perspective for the Canadian dollar.

  • We expect the Canadian Dollar to remain in a tight range around current levels relative to its U.S. counterpart.
  • We expect the U.S. economy to continue to be the best global performer.

Research & Analysis

We have added a tactic to our Canadian dollar strategy as the U.S. economy continues to have the most upside, in our opinion.

 

To avoid direct currency exposure while still taking advantage of the U.S. economy we are adding companies listed in Canada (on the Toronto Stock Exchange) that have a majority of income sourced in the US (another plus is if the company has a good hedging strategy). 

Current Strategy

Long-term Investment Strategy

  • Depending on a client’s goals, we will add unhedged U.S. positions to their personalized portfolio
  • Buying Canadian listed companies with majority of revenue sourced in the U.S (NEW)

Triggers for Strategy Change

  • Interest rate increases by the Bank of Canada
  • Increase oil price
  • Improving and robust Canadian economy

Categories

Type: Investment Strategy Thesis

Geography: U.S., Canada

Sector: Broad Market

Sub-sector: N/A

Area(s) of Analysis: Canadian Dollar, U.S. Dollar, U.S. economy

 

 

The opinions expressed in this report are the opinions of the author and readers should not assume they reflect the opinions or recommendations of Richardson GMP Limited or its affiliates. Assumptions, opinions and estimates constitute the author's judgment as of the date of this material and are subject to change without notice. We do not warrant the completeness or accuracy of this material, and it should not be relied upon as such. Before acting on any recommendation, you should consider whether it is suitable for your particular circumstances and, if necessary, seek professional advice. Past performance is not indicative of future results. The comments contained herein are general in nature and are not intended to be, nor should be construed to be, legal or tax advice to any particular individual. Accordingly, individuals should consult their own legal or tax advisors for advice with respect to the tax consequences to them, having regard to their own particular circumstances. Richardson GMP Limited is a member of Canadian Investor Protection Fund. Richardson is a trade-mark of James Richardson & Sons, Limited. GMP is a registered trade-mark of GMP Securities L.P. Both used under license by Richardson GMP Limited.