Independent Insight
U.S.A. vs. Google. What’s at Stake? Three Potential Scenarios.
The U.S. Department of Justice (DoJ) vs. Google trial will begin on September 12 and the key focus for investors is whether we’ll see changes to Google’s Search contracts.
Morgan Stanley Research quantifies the risk to Google (GOOGL) and Apple (AAPL) in three potential scenarios, which suggests limited risk to Google’s profit and loss (P&L) and a wider range of potential outcomes for AAPL.
Best Stock Ideas for 2023 From Our All-Star Roster
Time once again for a list of compelling stock ideas for the new year courtesy of our all-star roster of eight money managers, analysts and investment newsletter writers. From real estate expert Dennis Mitchell doubling down on a large cap stock to Davis Rea Investment Analyst Matthew Aspro’s favourite U.S. bank to market-beating contrarian Benj Gallander, who won last year’s stock picking challenge with a gain of 40 per cent. Large caps to small, dividend payers to growth companies and turnaround stories, we’ve assembled an eclectic array of top stock picks for you to consider to freshen up your portfolio.
10 Stocks to Own Through 2025
Uncommon Sense Investor visitors continue to discover this article in our archive. So, like a deep cut song by your favourite singer, we’re dusting it off and reposting it to our front page: Unless you’re a trader, the advice to investors from portfolio managers worth their salt is to own well-managed, dependable, market-leading companies that people touch every day, and to own them for the long haul. So what do you want to own from now until at least 2025? We ask because RBC Capital Markets Global Equity Research team has put together an exhaustive report entitled Imagine 2025: Themes, Opportunities and the “Law of Accelerating Returns”. We’ve plucked some key commentary, a list of 70 stocks from seven sectors, 10 Top Picks, and a few illuminating charts.
Why Tesla “Needs to Die Under Its Own Weight”
Nine months ago, John O’Connell projected the trading frenzy that propels the cult of Elon Musk and Tesla’s stock will burn out. The Chairman & CEO of Davis Rea Investment Counsel also said Tesla “doesn’t have a monopoly on taste.” We may be seeing some early signs of waning interest in the electric automaker’s vehicles, at least in China, based on a Sanford Bernstein survey. O’Connell’s opinions in this clip are as valid today as the day we spoke. Here are hi-lights from the Bernstein survey via a Bloomberg article.
Latest Stories
Davis Rea Conference Call
If you missed the live show, here’s your chance to watch the highly informative Davis Rea Investment Counsel conference call. Insight on the economy, inflation, interest rates, demographics, stocks, bonds, investor behaviour, plus some very illustrative charts. It’s all there. Get the details from the investment firm’s CEO, Economic Advisor, and Associate Portfolio Manager, about the strategies deployed that allowed Davis Rea equity and fixed income funds to outperform during the quarter.
“Roaring ’20s” Still Possible After “Mother of All Melt-ups” & Meltdown
Ed Yardeni has drawn fascinating comparisons between the technological innovation during the 1920s and the cutting edge technology trends of this decade. Find out from the President of Yardeni Research why another “roaring ’20s” decade is still possible for stocks despite the epic “everything” bubble that burst late last year and the subsequent decline we’ve seen since. Also, hear about Yardeni’s new service for retail investors called QuickTakes.
“Tremendous Opportunities” for Investors Despite “Rolling Recession”
Part two of our interview with Ed Yardeni sees the President of Yardeni Research explain how the U.S. is in a rolling recession, the possibility of a hard landing, the prospects for earnings, and when the major stock indices may hit a new high.
“It’s Right to Get Invested Here.”
John O’Connell on extreme bearishness, compelling stock valuations, and the potential for excellent future returns. The Chairman, CEO & CIO of Davis Rea Investment counsel believes the stock market is setting up long-term investors for some attractive gains. But that the S&P 500 may need to go down another 10 per cent or so before the worst is over.
“Lots of Things Are Breaking” Globally
Dr. Ed Yardeni considers himself an “optimist at heart.” But that doesn’t mean the President of Yardeni Research is wishing the U.S. Federal Reserve will “pivot” away from its interest rate tightening cycle. And it doesn’t mean Yardeni is hoping for the major stock indices to bottom. Instead, he’s tracking the data. Yes, he believes there are some “tremendous opportunities” for long-term investors and that a “roaring ’20s” decade is still possible after the “Mother of All Melt-ups. But he’s also pragmatic enough to see what he calls a “rolling recession” in the U.S. and has an opinion on the possibility of an economic hard landing. In part one of our interview with Yardeni, who has a wide following among institutional and retail investors, he gives us insight into why “lots of things are breaking” globally, why Fed Chairman Jay Powell is determined to slay inflation, where financial instability could emerge, the two “huge mistakes” the Fed made (Yardeni has written two books on the central bank), and many other cogent comments.
How Much Income & Capital Appreciation Do You Need?
How much interest income, dividend income, and capital appreciation does your portfolio require? It depends on a number of factors. John O’Connell guides investors through that decision-making process in the latest instalment of our Investor Education Series.
Four Ways to Determine Your Risk Tolerance
How are you coping with the wild swings in the stock market? How much stomach do you have for volatility and risk? In part five of our Investor Education Series, here are four ways to determine your risk tolerance.
Three Reasons Stocks Haven’t Bottomed & Inflation Could Last 10 Years
This may not be the message you want to hear but we try to bring you a variety of points of view. The following opinions eventually may not be correct but they’re worth listening to. That’s because they come from a strategist team that is paid to monitor global economic data and assess how it will affect financial markets. According to these strategists, there is more pain to come for the economy and stocks. They also say, based on historical evidence, that inflation may eventually decline to the U.S. Federal Reserve’s and Bank of Canada’s preferred level of two per cent, but that could take 10 years. Here are three reasons why.
Loss of Capital vs. Permanent Loss of Capital
Investors sometimes struggle with their emotions in differentiating between a loss of capital on paper, say a 20 per cent decline on your favourite stock, and with a permanent loss of capital. In this instalment of our Investor Education Investment Series, John O’Connell explains how investors should approach both scenarios in different ways.
Investing vs. Speculating
If you want to speculate in the stock market, knock yourself out. Jesse Livermore was a famous speculator about 100 years ago who made several fortunes but also lost several and his ultimate fate was a sad one. In the 1983 movie Trading Places, characters played by Dan Aykroyd and Eddie Murphy get rich in an elaborate scheme short-selling orange juice futures after they had created a speculative buying frenzy. Some people can speculate and do well but most can’t. So, what’s the difference between investing and speculating, and owning a business versus taking a shot at something? John O’Connell explains in the latest instalment of our Investor Education Investment Series.
Fed Pivot is a “BS Narrative”
Stop. Just stop. The narrative that the Federal Reserve is going to “pivot” and slow its inflation-fighting interest rate tightening cycle or pause or even start cutting rates soon is not going to happen. For one, the U.S. two-year yield, an indicator of expected near-term interest rates, is higher by about 30 basis points in the five days since various market players and many in the financial media revived the dovish Fed pivot story. A stronger than expected September non-farm payrolls number has boosted the two-year yield another six basis points, as I write this….Keep reading…
Focus on These “Three Buckets” For Your Investments
You’ve heard the term asset allocation but what does it actually mean when put into practice? In this instalment of our ongoing Investor Education Investment Series, John O’Connell, Chairman, CEO & CIO, Davis Rea Investment Counsel, explains why most investors should allocate their money into these three investment buckets.
Five Incredible Charts That Explain the Market Turbulence
Hedgeye Risk Management’s Keith McCullough started warning clients and subscribers about a bear market crash in January of this year. His theory has proven correct, based on data, and rooted in a belief that the most epic bubble of all time would burst, and that the Federal Reserve would make the mistake of tightening interest rates into a slowdown. Now, the CEO and founder of the research firm and his team have put together for their best clients a 160-slide quarterly investment outlook macro themes report. Here are five of these charts that nicely sum up why the global economy is teetering and financial markets are in turmoil.
Stock’s 683% Gain Wins TSX30 Growth Race Second Year Running
Aura Minerals (TSX:AOR) has ranked number one in the TSX30 Growth list for an unprecedented two years in a row. We talk to the CEO, Rodrigo Barbosa, whose diverse educational and career experience helps him guide this fast-growing company. Find out about Aura’s operations, their future prospects, and how this company’s stock has grown by more than 680 per cent in the past three years.
Can You Tolerate Volatility?
How are you handling the steep downturn in the major stock indices and the increasing volatility? If you can’t stand it and can’t sleep, then maybe you should not be invested in the stock market. That’s one of the messages in this conversation with John O’Connell, Chairman, CEO & CIO, Davis Rea Investment Counsel, who has lived through every bad day in the stock market since the crash of 1987. He also discusses the psychology of fear and greed, the difference between young investors and experienced investors, and their tolerance for risk. O’Connell told us two years ago that the meme stock craze would end in tears, and he was right. He says it’s a shame that so many young investors had to learn such a painful lesson. Watch this conversation for these invaluable and crucial comments from O’Connell during this difficult time in the markets.
Ride This Perennially Outperforming Gold Streamer
The world’s largest and most diversified precious metals streaming and royalty company is well insulated from cost inflation. The President and CEO of Franco-Nevada, Paul Brink, explains in this interview how the company’s business model and locked-in contracts are ideal in this inflationary environment. In fact, Franco-Nevada benefits from some higher prices because it also gets revenue from its oil and gas assets. Brink also talks about how the company has achieved a 17 per cent compound annual growth rate since 2007, acquisitions, gold, the Fed, and much more.
Why the Sun Will Also Rise for the Stock Market
Inflation is the most spoken word when discussing the state of the economy these days. To kill inflation, interest rates are raised to the point where business and consumers spend less. This causes people to lose jobs. The combination of reduced spending and growing unemployment causes a recession. The theory goes that when spending falls, demand falls to the point where there is excess stuff for sale and prices fall. Voilà, inflation goes away…keep reading.
“Discovery Potential” at the Golden Rose Project
Golden Rose in Central Newfoundland is now a turnkey project. Joel Freudman, CEO of TRU Precious Metals (TSXV:TRU), updates investors on the company’s latest acquisitions, which have doubled the size of the project. Freudman says Golden Rose is now just one of three dominant players in the region. It’s ideally situated in a prolific neighbourhood beside Marathon Gold, which plans production in 2025, and Matador Mining. Find out more about TRU’s discovery potential in this “once in a lifetime opportunity”, which boasts Eric Sprott as one of the company’s largest shareholders.
Seven Canadian “Debt Monsters” Have Bond Markets Worried
As interest rates continue to rise, there is increasing anxiety in financial markets about the possibility of some kind of credit event. The Financial Times has assembled a list of more than 200 companies that it calls “debt monsters in the downturn”, whose debt is trading more than 10 percentage points or 1,000 basis points above government bonds. That means the market may be concerned about the possibility of some of these companies defaulting on their debt. FT’s list features seven Canadian companies.
25 Years After Bre-X by the Man Who Made a Fortune Going Long & Short of the Biggest-Ever Mining Fraud
Mention Bre-X to anyone who was even remotely following financial markets in the late 1990s and they know exactly what you’re talking about. The company, which claimed it had discovered massive amounts of gold in Indonesia, turned out to be a $6 billion fraud. Warren Irwin was a young MBA grad when he first visited Indonesia in 1991 and had a feeling he would be back to make his fortune. It was a very prescient premonition because four years later, Irwin, then with Deutsche Bank, returned to the country, met the Bre-X team and toured the the company’s mine site. Here is Irwin’s account of his experience with the Bre-X story…keep reading.