Portfolio Manager’s February Comment for January Results

In January, the S&P/TSX decreased by 0.4%, the S&P 500 fell by 5.2% while the MSCI ACWI ex USA contracted by 3.7%.

At the end of the 12-month period ending January 31st , the S&P/TSX grew by 25%, the S&P 500 gained 23.3% while the MSCI ACWI ex USA posted a meager return of 4.1%.

In January, NQICAT increased by 0.2% while it climbed 21.6% on an annual basis.

The best TSX sectors for the month of January were Energy up 17.7%, Financials up 3.6% and telecommunication up 2.2%.

The worst performing sectors were Information Technology down 12.0%, Heath Care down 8.7% and Industrials down 3.4%.

The best monthly performers in NQICAT were Parex Ressources up 25.1%, Richelieu Hardware up 14.6% and Royal Bank of Canada up 8.0%. At the opposite, the weakest contributors were goeasy down 17.4%, Transforce down 13.5% and Canfor down 9.9%.

3 stocks were sold and bought in the strategy.

The strategy required an exposure reduction to the Material sector for 2 stocks. Winpak (WPK) and CCL Industries Class B (CCL.B) had the lowest SP score therefore they needed to be sold. Leon’s Furniture (LNF), a consumer discretionnary, and Canadian Pacific Railway (CP), an industrial, were added to the portfolio due to their high SP scores.

Kirkland Lake Gold (KL) was sold due to its anticipated merger with Agnico Eagle (AEM). AEM has a lower SP score, so we replaced KL for a company with a higher SP score i.e. Labrador Iron Ore Royalty (LIF).