Baskin reveals outlook for 2018
Buying stocks in Canadian banks, telecoms, utilities and pipelines are likely to feature heavily in the investments made by Toronto-based Baskin Wealth Management.
In its 2018 outlook the firm says that, even though the value of Canadian equities has risen by just 2.5% in the first nine months of 2017, stocks in those four sectors tend to give higher dividends.
Yields from many high dividend stocks have been around 3-4%, beating the returns from bonds which Baskin deems “quite unattractive” for government bonds and “only somewhat more attractive” for corporate bonds.
Baskin forecasts that Canadian government bond yields are likely to be below 2% in 2018 with US bonds slightly higher at 3%.
For US stocks, although there are disadvantages to Canadian investors owning them, the firm expects to focus on large tech firms with little exposure to competition; selected undervalued health firms; and companies offering consumer experiences.
What about cryptocurrencies?
Baskin says that there are three main problems with investing in Bitcoin and other cryptocurrencies.
Firstly, its lack of real-world value backed up by law. As Bitcoin is not technically ‘legal tender’ Baskin highlights the risk of relying on someone believing the investment has value.
Secondly, there is risk from regulatory policies which has already been felt in China. Baskin warns that if governments were to rule that cryptos cannot be legally used in transactions it could affect value or even lead to them
shutting down.
Lastly, the wealth manager points out the low concentration of ownership which makes it vulnerable to price manipulation.
The full outlook is available at baskinwealth.com
In its 2018 outlook the firm says that, even though the value of Canadian equities has risen by just 2.5% in the first nine months of 2017, stocks in those four sectors tend to give higher dividends.
Yields from many high dividend stocks have been around 3-4%, beating the returns from bonds which Baskin deems “quite unattractive” for government bonds and “only somewhat more attractive” for corporate bonds.
Baskin forecasts that Canadian government bond yields are likely to be below 2% in 2018 with US bonds slightly higher at 3%.
For US stocks, although there are disadvantages to Canadian investors owning them, the firm expects to focus on large tech firms with little exposure to competition; selected undervalued health firms; and companies offering consumer experiences.
What about cryptocurrencies?
Baskin says that there are three main problems with investing in Bitcoin and other cryptocurrencies.
Firstly, its lack of real-world value backed up by law. As Bitcoin is not technically ‘legal tender’ Baskin highlights the risk of relying on someone believing the investment has value.
Secondly, there is risk from regulatory policies which has already been felt in China. Baskin warns that if governments were to rule that cryptos cannot be legally used in transactions it could affect value or even lead to them
shutting down.
Lastly, the wealth manager points out the low concentration of ownership which makes it vulnerable to price manipulation.
The full outlook is available at baskinwealth.com
