Here are my suggestions for 2016 (higher volatility) and how I am suggesting portfolio’s be allocated.
Those with cash flow requirements should have 2-4 years income in low volatility (low return assets)
THOSE WITH CASH FLOW REQUIREMENTS SHOULD HAVE 2-4 YEARS INCOME IN LOW VOLATILITY ASSETS
All clients should have about 20-40% in YIELD oriented funds which have distributions in the 5-6% range. These funds are less reliant on gung-ho stock markets and generally have more dependable income streams:
CI Diversified Yield
Dynamic Strategic Yield
Aston Hill High Income
Where possible move dedicated real estate and infrastructure into DIVERSIFIED yield funds were decisions can be more time sensitive and tactical.
We still have exposure to a weak CDN$ for the following reasons:
Lower currency may attract business BUT the Mexican peso has lost even more against the US$
Several U.S. have ZERO tax for corporations
Higher potential payroll taxes in Ontario (new Ontario pension plan)
CDN$ hit 62 cents before WITH NO COMPETITION
Some ‘experts’ believe the CDN$ will visit the high 50’s before a sustained recovery with an average of 62 cents over the next 10 years.
Everything CDN is down…will housing be next
PROTECT AGAINST PERMANENT…I REPEAT, PERMANENTLOSS OF CAPITAL. There is ABSOLUTELY no way to eliminate volatility and generate returns double+ that of 5 year GIC’s (currently 2.2%).
If you have questions or concerns please call or arrange a meeting.
See everyone at tax time (if not sooner).
The views expressed do not necessarily reflect the opinion of Argosy Securities Inc. This does not constitute an offer or solicitation to buy or sell any of the securities mentioned. The information contained herein may not apply to all types of investors. Please consult a professional before making an investment decision.