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

Importance of technical analysis. Both fundamentals and technical analysis are important. It's not one or the other. If valuation doesn't matter and you are trading chart patterns, it is the market for it. There is momentum and volatility.

Educational Segment. Gold remains one of his favourite sector. Looking at Barrick Gold, the median price target for the US fund is 34.52, which is around 30% upside. The reason they are not priced at higher valuation today is because of the gold price forecast. Gold remains attractive when thinking about central banks monetizing debt to keep interest rates low. The correlation between real yields and gold is very high. Some short-term volatility but a long term opportunity.

Market. He wrote that there was going to be a spectacular upside in the markets following an announcement of a COVID19 vaccine and then it happened the next morning. It is very positive and let's hope it works as well as Pfizer is saying. Hospitality, airlines and real-estate have been the most battered sectors from the pandemic. Anything can go wrong. When the airlines get going again it is going to be very positive for oil. He wants to look at it more carefully. He has never been a fan of gold. He is not a gold bug.

Bank covered calls when they go out of the money. It depends on what the banks are doing. If banks are falling he will buy back the call and sell closer. If it is rising, he will buy it back and ride the stock itself. You have to be very nimble and know what you are up to.

Total return ETFs work on the basis that there are no distributions being paid. To do the swaps they have to have counter parties. He does not see a lot of risk with the counter parties, however. He does not see a tax risk, or a counter party risk. Horizon have a good piece they can send to you on the structure of these ETFs.

Horizons Total return product vs. a Vanguard product. It is a case of whether you want taxable distributions or not. He tends to use Vanguard because most of his clients are older and want distributions.

Bond ETFs, Canada and US – Buy, Sell or Hold? When COVID came up he sold all of his bond ETFs and has not budged since. Now the returns are so meager that he is not buying them.

Pfizer's vaccine news sent markets soaring today. However, the Nasdaq lost 1.53%. Sell REITs in offices and malls. Dump oil, because producers keep turning out volume whenever prices spike. Restaurants will see an uptick in 2021. Banks will earn more money as interest rates rise in the near future--sell into strength. Airlines of course will rise. Rails and industrials have had a good run, but are getting long in the tooth. Covid stocks like Peloton and Zoom Video will see multi-day sells, but we still need to get through this winter with Covid cases. Apple will do well under Biden, encouraging business with China. We would have rallied today anyway given certainty over the US vote. Covid names will continue to sell this week as the recovery ones continue to thrive.

The policies under Trump were affected by his mood, whereas with Biden you get more predictability. The markets are selling off today due to uncertainty. Looking forward, we could get a vaccine soon which is driving the markets too. A Biden presidency is probably better in the longer term.

Vaccine. The markets tend to be forward looking. There are over 230 vaccine candidates in production. News that there is a vaccine available would be very stimulating as this would allow for workers to get back into the office as well.

The market is bifurcated. There is high growth that has responded well, particularly non-profit making tech. There are some companies that have proven dividend payout and growth, yet the market does not seem to care for it. He is looking to put capital to work in the best risk adjusted basis. However, we must wait and see still. Asia will rally with a Biden win.

Residential REITs. There is legislation and backlog in landlord and tenancy board that makes it hard to get non-paying renters out. In the near term, there is credit risk and balance sheet risk. Longer term though, people need to live somewhere and REITs could be interesting. Residential REITs would be preferential but in areas with buoyant employment where it will recover. The valuation in industrial REITs are rich, and retail is problematic.

All eyes are on next week: On Monday, we'll know who won the election. What to do? Nothing. We will still have divided government. Oil is a no-go under Biden, but expect better relations between the US and China, like a truce in the trade war. Next week will be unpredictable in a crazy market, but he remains bullish. This week was the best in years.