Financial advisor explains why he isn’t buying Canada
One financial advisor says that his clients’ portfolios have almost no exposure to Canada because of the lagging resource sector and the opportunity beyond the country’s borders.
“I love Canada, I love living here,” Jeff Hull, senior financial advisor at Manulife Securities Inc, told BNN in an interview Friday. "But the reality is, there is so much beyond our border.”
“Canada has a lot of headwinds right now,” he added. “There’s a lot of uncertainty around [U.S. President Donald] Trump and his policies…The reality is Canada has a tough road to hoe ahead with a lot of the resource sector.”
Hull said his clients don’t have exposure to any Canadian banks; instead, he prefers to steer investors to the United States.
“Part of the other reality why I’m out of Canada so much isn’t just that there’s better opportunities beyond our border – but my investing clientele lives in Canada, has a house in Canada, has their job and their pension in Canada. They already have so much Canada.”
Hull said that Canada makes up only three per cent of the global equity market, and that going beyond Canada’s borders isn’t such a bad thing.
“I like to think of my investments or a stock like an economic castle. And around that castle, I want a deep and wide moat – as wide as possible, so competition can’t come eat my lunch or take my castle. In addition to that, I want a knight in that castle in the form of a CEO who is going to protect me against marauders or other things that are going to try and come and take it away from me.”
When it comes to getting people to invest in Canada, Hull said people will start to creep back in and invest in companies at a discount if there’s a big enough drop.
“But they’ve got to be companies that are innovating – that are part of the future, not the past.”