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Model Portfolio

Portfolio Manager’s September Comment For Q3 2021

The performance of the equity market has been subdued by inflation concerns as well as China real estate debt burden, supply chain disruption and COVID fourth wave. September took away most of the early gains of the quarter.

In Q3, The S&P/TSX expanded by 0.2%, the S&P 500 rose by 0.6% while the MSCI ACWI ex. USA decreased by 2.9%.

In Q3, NQICA returned 3.2% leading to a 1-year return of 26.3% versus the S&P/TSX composite which returned 28.0% on an annualized basis.

In Canada, the best Q3 sectors were Consumer Staples up 3.8%, Energy up 3.3% and Information Technology up 3.2%. The worst sectors were Health Care down 21.9%, Consumer Discretionary down 6.4% and Materials down 6.0%.

In Q3, the best performers of NQICA were goeasy (GSY), TFI International (TFII) and Winpak (WPK) up 27.8%, 14.8% and 13.7% respectively.

On the other hand, the worst performers were First National (FN), Canadian Tire (CTC.A) and Stella-Jones (SJ) down 10.4%, 9% and 4% respectively.

Portfolio Manager’s September Comment for August Results

The S&P/TSX Total Return Index expanded by 1.6% in August, the S&P 500 grew a robust 3.0% and the MSCI ACWI ex. USA increased by 1.9%. At August’s end, the 12-month S&P/TSX Total Return Index was 28.2% behind the S&P500 gain of 31.2% and lower than the MSCI ACWI ex. USA which rose by 25.4%.

In August, the NQICAT increased by 3.0% while it climbed by 30.5% on an annualized basis.

The best TSX sectors for the month of August were Information Technology up 8.9%, followed by Industrials up 3.4%, and Telecommunication services up 3.0%.

At the opposite, the worst performing sectors were Materials down 3.0%, Energy down 1.5% and Consumer Discretionary down 1.4%.

The best performers in August were goeasy up 14.5%, Canfor up 12.4% and Canadian National Railway up 9.5%.

On the other hand, the weakest contributors were Kirkland Lake Gold down 5.7%, Stella-Jones down 4.7% and Dollarama down 2.0%.

Portfolio Manager’s August Comment for July Results

In July, the S&P/TSX increased by 0.8% and the S&P500 rose by 2.4% while the MSCI ACWI ex USA lost 1.6%. At the end of the 12-month period ending July 31st, the S&P/TSX grew by 29.1%, the S&P500 gained 36.4% while the MSCI ACWI ex USA posted a return of 28.8%.

In July, NQICAT increased by 3.8% while it climbed 29.1% on an annual basis.

The best TSX sectors for the month of July were Consumer Staples up 6.3%, followed by Information Technology up 3.0% and Materials up 3.0%. The worst performing sectors were Health Care down 11.6%, Energy down 11.3% and Consumer Discretionary down 0.9%.

The best monthly performers in NQICAT were Transforce up 23.7%, Winpak up 13.3% and Equitable Group up 12.8%. At the opposite, the weakest contributors were Canfor down 15.1%, First National down 5.9% and TD down 3.6%.

2 stocks were sold and bought in the strategy in July.

The strategy required an exposure reduction to the Telecommunication sector. Quebecor (QBR.B) had the lowest SP score therefore we sold it. We sold Evertz Technologies (ET) due to its low SP score.

The model required an increased exposure to 1 Consumer Staples The North West Company (NWC) made it into the strategy. We replaced Evertz by GDI Integrated Facility Services Inc.

StockPointer® Canada Portfolio Transactions – July 2021

We have rebalanced the Nasdaq Inovestor Canadian Index based on our Stockpointer® Canada model portfolio. These trades are effective as of Friday, July 16 after market close. Here are the details of the trades:

Ins:

  1. North West Company (NWC) – Market Trend. Increase in the Consumer Staple sector as shown by the Top 100 index, therefore, increasing our position in the portfolio. We chose the company because of its high SP score.
  2. GDI Integrated Facility Services Inc. (GDI) – Intra-sectorial transaction market. In the top of its sector.

Outs:

  1. Quebecor (QBR.B) – Market Trend. Decrease in the telecommunication sector as shown by the Top 100 index, decreasing our position in the portfolio.
  2. Evertz Technologies (ET) – Intra-sectorial transaction and market. No longer in the top of its sector.

Portfolio Manager’s July Comment For Q2 2021

The performance of the equity market continued its upward trend following the beginning of the vaccination campaign and in anticipation of the complete reopening of the economy.

In Q2, The S&P/TSX Total Return Index rose by 8.5%, the S&P 500 expanded by 8.5% as well while the MSCI ACWI ex. USA increased by 5.5%.

In Q2, NQICA returned 4.3% leading to a 1-year return of 34.4% versus the S&P/TSX composite which returned 33.9% on an annualized basis.

In Canada, the best Q2 sectors were Energy up 20%, Information Technology up 15.8% and Telecommunication up 9.3%. The worst sectors were Health Care down 12.0%, Utilities up 0.5%, and Industrials up 0.8%.

In Q2, the best performers of NQICA were goeasy (GSY), TFI International (TFII),  and Power Corporation of Canada (POW) up 26.8%, 20.4% and 18.6% respectively.

On the other hand, the worst performers were Winpak (WPK), Stella-Jones (SJ) and Canadian National Railway (CNR) down 14.1%, 11.7% and 9.9% respectively.

Portfolio Manager’s June Comment for May Results

The S&P/TSX Total Return Index expanded by 3.4% in May, the S&P 500 grew a meager 0.7% and the MSCI ACWI ex. USA increased by 3.2%. At May’s end, the 12-month S&P/TSX Total Return Index was 33.8% behind the S&P500 gain of 40.3% and lower than the MSCI ACWI ex. USA which rose by 43.4%.

In May, the NQICAT increased by 1.9% while it climbed by 34.2% on an annualized basis.

The best TSX sector for the month of May was Energy up 10%, followed by Materials up 8%, and Consumer Staples up 4.4%. At the opposite, the worst performing sectors were Health Care down 3.4%, Consumer Discretionary down 1.1% and Info Tech down 1%.

The best performers in May were Kirkland Lake Gold up 13.6%, Power Corporation of Canada up 9.9% and TransForce up 7.8%.

On the other hand, the weakest contributors were Stella-Jones down 9.9%, Dollarama down 8.3% and Winpak down 5.7%.

Portfolio Manager’s May Comment for April Results

In April, the S&P/TSX increased by 2.4% and the S&P500 rose by 5.3% while the MSCI ACWI ex USA gained 2.8%. At the end of the 12-month period ending April 30th, the S&P/TSX grew by 33.3%, the S&P500 gained 46% while the MSCI ACWI ex USA posted a return of 43.6%.

NQICAT increased by 2.4% while it climbed 37% on an annual basis.

Quaterly results published in April were in line to better than expected for the majority of companies.

The best TSX sectors for the month of April were Materials up 5.4%, followed by Consumer Discretionnary up 5.1% and Telecommunication Services up 3.4%. The worst performing sectors were Health Care down 9.9%, Industrials down 1.1% and Utilities down 0.6%.

The best monthly performers in NQICAT were Canfor up 17.9%, goeasy up 16.2% and Transforce up 14.6%. At the opposite, the weakest contributors were Canadian National Railway down 9.3%, Winpak down 5.2% and OTEX down 3.4%

3 stocks were sold and bought in the strategy in April. The strategy required an exposure reduction to 3 sectors, namely Consumer Staples, Consumer Discretionary and Energy. Empire Company (EMP.A) had the lowest SP score of our Consumer Staples therefore we sold it. We sold Thomson Reuters (TRI) due to its low SP score. Parkland (PKI) was sold since it was the only Energy stock in the portfolio and futhermore its EPI was below 1.

The model required an increased exposure to 1 Materials and 2 Financials. The names that made it into those sectors were Canfor (CFP), Power Corporation of Canada (POW) and goeasy (GSY).

StockPointer® Canada Portfolio Transactions – April 2021

We have rebalanced the Nasdaq Inovestor Canadian Index based on our Canadian Model Portfolio, effective April 16 after market close.

Here are the details:

Ins:
1. Power Corporation of Canada (POW) Market trend. Increase in the Financial sector as seen in the Top 100 index, therefore, increasing our position in the portfolio. The company is in the top of its sector
2. goeasy Ltd (GSY) – Market trend. Increase in the Financial sector. The company is in the top of its sector
3. Canfor (CFP) - Market trend. Increase in the Material sector. The company is in the top of its sector

Outs:
1. Thomson Reuters (TRI)  Market trend. Decrease in the Consumer Discretionary sector as seen in the Top 100 index, therefore, decreasing our position in the portfolio. The company has the second lowest SP score of the sector. Richelieu Hardware (RCH) has the lowest SP score by one point, but we preferred it over TRI.
2. Empire Company (EMP.A) – Market trend. Decrease in the Consumer Staples sector. The company has the lowest SP score of the sector.
3. Parkland (PKI) Both Market trend and the EPI fell below 1. Decrease in the Energy sector. It was the only stock in the Energy sector.

Portfolio Manager’s April Comment For Q1 2021

The performance of equity markets continued its upward trend following the beginning of the vaccination campaign and the anticipation of the complete reopening of the economy.

In Q1, The S&P/TSX Total Return Index rose by 8.1%, the S&P 500 expanded by 6.2% while the MSCI ACWI ex. USA increased by 3.8%.

In Q1, NQICA returned 9.4% leading to a 1-year return of 48.5% versus the S&P/TSX composite which returned 44.2% on an annualized basis.

In Canada, the best Q1 sectors were Health Care up 38.1%, Energy up 28.2% and Financials up 12.7%. The worst sectors were Materials down 7.3%, Info-Tech up 1.0%, and Utilities up 2.4%.

In Q1, the best performers in NQICA were TFI International (TFII), Richelieu Hardware (RCH) and Equitable Group (EQB) up 44.2%, 25.4% and 25.3% respectively.  On the other hand, the worst performers were Kirkland Lake Gold (KL), Alimentation Couche-Tard (ATD.B) and Parkland Corp. (PKI) down 18.9%, 6.6% and 5.8% respectively.

Portfolio Manager’s March Comment for February Results

The S&P/TSX Total Return Index expanded by 4.4% in February and the S&P 500 grew by 2.8% while the MSCI ACWI ex. USA increased by 2.0%. At February end, the 12-month S&P/TSX Total Return Index rose 14.7% behind the S&P500 gain of 31.3% and higher than the MSCI ACWI ex. USA who nevertheless rose by 26.7%. The markets grew on the back of strong company results.

In February, NQICAT increased by 3% while it climbed by 12.9% on an annual basis.

The best TSX sector for the month of February was Energy up 22.4%, followed by Consumer Discretionary up 8.7%, and Financials up 6.7%. At the opposite, the worst performing sectors were Utilities down 5.7%, Material down 4.5% and Consumer Staples down 0.9%.

The best performers in February were Equitable Group up 31.1%, CCL Industries up 14.2% and National Bank up 12.5% due to impressive results.

On the other hand, the weakest contributors were Kirkland Lake Gold down 15.3% as gold prices fell 6.1% during the month. Hydro one was down 8.8% due to rising long-term interest rate and Metro was down 4.3% as investors continue to focus on cyclical stocks and expect lower revenue growth.