A Comment -- General Comments From an Expert (A Commentary)

Markets: They are very conservative. Capital preservation, beat inflation, and grow assets slowly. Wants good quality equities that have current yield and ability to increase dividends over time. With what’s going on in the middle east and Japan, they are not that active at a time like this. He is trying to find companies that are going to increase their dividends. He is hoping gold stocks will popup, but dividends are low. He likes telecom and cable stocks – they have nothing for a year and half.

Banks: Believes in dividend growth coming from the banks. There was a moratorium on dividend raises through the financial crisis. He sees growth although it will not be the punchy numbers we saw previously because of the new capital requirements from the new regulations.

The Canadian way of investing is spreading around the world. Income or dividends has been a big part of the returns of investing. The Canadian way is to go with growth, payout and stability/growth of dividends. Investors around the world are focusing on dividends more and more. We should focus more in the increase in shares outstanding for companies.

India/Emerging Markets: As a Canadian you cannot invest directly in India, but you can invest in ETFs that invest in Indian stocks. Another way is ADR. You can buy some of the bluest of blue chip Indian stocks to expose to India. India has a higher beta. Money moved out of Emerging Markets in the second half of last year and now he sees it going back into emerging markets.

American: As a global manager this is the first time in 7 years he is going American. Things are starting to things change in a very positive way. Don’t read headlines – look at the fundamentals. US Banks have started to raise their dividends. This is a very good sign that certain structural changes in the US are going to be cery acredive to stocks. Growth/Payout/Sustainability in US is starting to grow and increase. After sub-prime you have seen more US companies become very global.

Markets: Isn’t it great! You want to be buying when the markets are low. You want to wait until you are in this kind of correction before you buy. Look at technical indicators. Stochastic came down and are starting to recover. We got a buy signal two days ago. This is the point in seasonality for the markets to go higher. From here until the first week in may. With these events [political+Japan], then happen and the markets recover quickly. You don’t try to predict them. When first quarter reports come out, they are going to be very good. This is when companies have annual meetings and they like to say they had a great first quarter. They are sitting with a lot of cash on their books and are going to want to reward their shareholders. There will be stock splits, share buy backs, dividend increases – lots of good news. Markets will slowly anticipate this good news. In this year related to US elections, markets extend their usual spring up trend. He will play one month at a time.

Gold or Platinum: Seasonally, normally platinum is stronger until the end of May. Gold during Jan/Feb, then sideways until end of July, then you get in until next Feb. But now Gold is forming a bit of resistance. Nothing serious but it is having difficulties. He loves the up trend in Gold. Historically Gold has trouble at this time of year.

Market: Buy and shorts a stock and tries to achieve a definite rate of return. He can have relatively robust returns even in this market. He plays mergers. Trade around event driven strategy. This market has been challenging because of the volatility. He says to stay diversified and stay on the side of where companies are experiencing positive change rather than negative.

Market: After an 8-month upward move, we are now in a correction but still within a bull market, not a bear market. Certainly when there are things happening in the world there are opportunities. He is looking at cyclical names that have come down more than others. Fertilizer, coal, copper, agri. Selectively choose your names. At the end if the year, the markets will be positive. Thinks Japan will not be a big impact. Is not looking at Japanese companies because they are too close to the core and the North American economy is improving quite well.

It’s a difficult situation with the Japanese Nuke situation. You can’t price what you can’t understand, but the market has to do it. He has had 5 of 40 companies in his small cap take out since October.

Markets: We were due for a correction. We had a strong bull market for 2 years. There is always worries that creep into the market. There will be repercussions that reverberate through the economy. The big thing in Japan is that they lost a huge portion of their electrical capacity. Right now it is far too much in flux. Japanese companies are very large and for the most part pretty fairly priced. We have to see how tings shake out over the next couple of weeks.

Day Trading: It is not investing, but a legitimate part of the market. Day trading is being taken over by very fast computers. One should take computer science courses as well as business courses.

There is not enough information on the stocks that they own to make a decision on how to react to the situation in Japan. He thought the commodities prices were getting a little high anyway. Oil was due for a correction and it only corrected a little bit. He owns several big holdings in China as his biggest holdings in emerging markets.

Markets: It matters what causes a correction. What has happened in Japan impacts oil, etc. What they supply may be interrupted. First we thought there was a rotational correction and now it is a full 10% correction. We are in the midst of a correction and not the start of a new bear market. A lot of stocks and indices are well above their 200 day moving averages, so as long as the pull back stays above these then you can see the long term up trend is still in tact. By mid-year we should see another up-leg in this bull market.

Japan: Wonders about the long-term affect on Oil. What about the number of reactors being taken out by one nuclear reactor. Price of Natural Gas is quite low and will stay low if our fields are allowed to develop, or if nuclear reactors are allowed to developed that they don’t get washed away so easily. It depends on what is really happening in Japan. Wonders if metal prices are squeezed because it is not in their best interests to see metal prices increase.