The Santa Claus Rally Continues...Ho Ho Ho!

The Santa Claus rally arrived right on cue, with US stock markets reaching new highs, and the 10 year US Treasury yield touching 3% for the first time in a long time. On top of that, the US dollar has just gotten stronger against many major currencies. One has to wonder how much more room is there for the market to rally in 2014, and will this rally finally run out of steam? On a local note, we have been struck with quite a storm, for all of you affected by the lengthy power outages, we hope you and your families have been able to find somewhere safe to enjoy the holidays. 2013 has seen many disasters for us: floods, power outages and the Fed hints of tapering. Let’s hope 2014 is less eventful!

The dreaded taper finally arrives…and the market approves!

By Justin Turner CIM, DMS®, CFP®

On Chairman Ben Bernanke’s final meeting, the Federal Reserve decided to finally taper their bond buying program by 10 billion, which came as a surprise to many market participants.  For many, the bigger surprise was that the market reacted positively to the news and has had a huge rally which has continued and may continue through to the New Year.  Despite fears of the potential negative implications of the Fed tapering, the fact that they decided to go ahead with it shows that the economy is most likely on its way to being able to stand on its two feet without the massive amount of liquidity currently being injected into the US economy.  Only time will tell if their decision was the correct one, but for now the market is content evidenced by all of the major US stock indices reaching new highs.

On behalf of the Orgil Wealth Management group, I want to wish our clients, friends, colleagues and readers Happy Holidays and a safe and Happy New Year.  Let’s hope 2014 brings us positive markets once again.

Is the Fed finally going to taper?

By Justin Turner CIM, DMS®, CFP®

The market seems to think so.  Stocks have pulled back over the past week with investors taking profits and perhaps heading to the sidelines to wait out the US Federal Reserve’s announcement next week.  On top of weak markets, we have also seen a rise in 10 Year rates, with the 10 Year US Treasury topping out at about 2.90%.  While still low in historic terms, it is dramatically higher than anything we have seen over the last few years, and is cause of concern in the eyes of some analysts.  In Canada, bank stocks had shown signs of life following a sell-off over the last couple of weeks, but have since continued their downward move eating heavily into 2014 YTD gains in the process.

Will the Fed bring us an early present next week or will they trigger a rare end of the year sell-off and a gloomy start to 2014?  The only sure thing is that next week will be a volatile one and not only will it set the tone for the end of the year, but it could give valuable clues as to where the market might be headed in 2014.

Disappointing Bank Earnings Slow Financial Sector Rally

By Justin Turner CIM, DMS®, CFP®

A strong multi-month rally in the Canadian financial sector was halted abruptly as the latest round of bank earnings disappointed, giving investors an excuse to take profits from a sector that has delivered superior returns in 2013.  The earnings weren't necessarily bad, but after a rally that had seen banks up over 20% year to date, expectations were higher for this batch of earnings and banks were unable to deliver.  

A number of noteworthy pieces include Bank of Montreal, National Bank and in a surprise TD Bank all raised their dividends.   TD Bank also announced a stock split for shareholders of record on January 23^rd, 2014.  Finally, Royal Bank CEO Gord Nixon announced that he would be retiring in 2014.

The TSX ended the month up a modest 0.31% and up about 8.11% year to date.  The US market has been stronger than just about any market in the world in 2013, and November was no different with the Dow Jones Industrial average returning another 3.42% bringing its year to date total to over 20%.  The Nasdaq has been even better, returning 3.57% in November, and bringing its year to date total to a whopping 34.46%.  

What will December have in store for us and will we get yet another Santa Claus rally?  We'll have to wait to find out, but if history is any indication, then we probably will and these impressive 2013 numbers will look even more impressive by year's end.

Preparing for Year End

By Yaron Orgil CIMA®, FCSI®

When we flip to the final page of the calendar, we’re often preoccupied with the holiday season and many times forget to tie up loose ends, especially regarding our finances.  With that in mind, please click the link below for our year-end checklist which includes some useful ideas and strategies.  Some of these include taking advantage of tax harvesting opportunities prior to the end of the year, maximizing your TFSA and RESP contributions, and making charitable donations. 

2013 Year-End Tax Planning Checklist

We invite you to call our office anytime to discuss in more detail.

No Black Friday deals in the stock market

By Justin Turner CIM, DMS®, CFP®

American Thanksgiving is a traditionally slow trading week, but that hasn't stopped many of the major indices from drifting upwards and reaching new highs.  The Nasdaq hit 4,000 for the first time since the tech bubble and looks to be headed even higher.  Many experts feel the stock market is currently a bubble waiting to burst, but the fact that so many people are talking about bubbles is healthy and probably means we aren't in a bubble…yet.

**Stay tuned, next week we will double our weekly blogs to include wealth and tax planning strategies. The strategies will include straightforward topics such as RRSP and TFSA investing to more complex strategies geared toward specific investor groups.

Dow closes above 16,000 for the first time

By Justin Turner CIM, DMS®, CFP®

With the economy in better shape and based on the minutes from the most recent Federal Reserve meeting, there are rumours that the Fed could start tapering before year-end.  Although we don’t feel tapering will begin until Janet Yellen takes over in the New Year, the market does seem to be preparing for this eventuality, with rising rates, falling gold prices, and some pretty steep falls in some of the riskier sectors.  However, overall, tapering can be seen as a good thing as it supports the view that the economy is strengthening and may be able to stand on its own two feet one day without the high levels of stimulus the fed is currently providing. 

Taper or no taper, the US market has been unstoppable.  The Dow Jones closed above 16,000 for the first time ever on Thursday.  With interest rates most likely staying at historic lows for the foreseeable future, one has to wonder what, if anything can stop this market from moving significantly higher over the coming months and years.  Although the TSX has a long way to go before hitting new highs of its own, it has been quite strong and looks poised to test 14,000 in the near future, which would represent a rally of close to 20% since the lows of the summer.   It appears that for the time being the wise move would be to ride the current momentum and remain invested through at least the end of Q1 2014 when tapering as well as seasonal affects could potentially cause weaker markets.  Despite the headwinds the market could face in 2014, the long term picture looks brighter as the world economy continues on its road to recovery and the damage done to investor confidence subsides.

QE isn’t going anywhere

By Justin Turner CIM, DMS®, CFP®

Could Janet Yellen be even more dovish than her predecessor Ben Bernanke? After a week of relatively sideways markets, stocks moved up on Thursday as investors embraced signs sent by Yellen that the Fed would continue its monetary stimulus.  

Riskier assets such as gold and emerging market stocks saw especially strong moves. Yellen’s hearing before the Senate Banking Committee made it clear that she is going to continue the policies currently in place.  With markets now less concerned with the Fed’s withdrawal of stimulus in the near term; the market could see a substantial rally to close out the year, especially in the riskier or interest rate sensitive sectors.  The S&P seems poised to test the 1800 level, something most would have found virtually impossible this time last year.  

With markets at these lofty levels, we think that selling covered calls could be a good strategy to generate income while lowering downside in the event of a market correction.

Twitter IPO Recap

By Justin Turner CIM, DMS®, CFP®

Twitter (the stock) has finally arrived.  The stock opened at $45.10, a whopping 73.5% above the IPO price set less than a day before! It closed right around where it opened at $44.90.  It was a pretty incredible day one performance, but investors looking to get in on the action might want to hold off a bit as lower prices could be just around the corner.  

As far as the broader markets are concerned, the theme for quite some time has been risk-on with many markets (including Canada) hitting new multi-year highs benefiting from the delay in the US Federal Reserve’s tapering of asset purchases.  The talk has gone from government shutdowns and the debt ceiling to the Fed and the ending of quantitative easing (QE).  The current view is that tapering is unlikely to start this year due to weaker economic data.  Very accommodative monetary policy, combined with increasing global economic growth is providing a strong environment for stocks.  We see this strength potentially carrying through the end of the year and into the New Year.  

Welcome to the Orgil Wealth Management Blog!

Please check back here regularly for informative updates.  We'll have a variety of topics ranging from what’s going on in the markets to wealth enhancing strategies that we can help our clients implement.

If you would like our posts to be emailed to you, please let us know by emailing Team.Orgil@RichardsonGMP.com

Who are we?

Yaron Orgil CIMA®, FCSI®, Director, Wealth Management & Wealth Advisor

Yaron holds the Certified Investment Management Analyst (CIMA®) designation from the Wharton School at the University of Pennsylvania. He is also a Chartered Investment Manager (CIM®) and a Fellow of the Canadian Securities Institute (FCSI®). Yaron is a fully accredited Portfolio Manager qualified to perform discretionary money management. He graduated Magna Cum Laude from Drexel University with a B. Sc in Business Administrations where he was a member of the hockey team that competed in the American Collegiate Hockey Association and helped lead the team as co-captain to the Eastern Collegiate Hockey Association’s league championship in his senior year. Yaron lives in Toronto with his wife, their two young boys, and dachshund/terrier.

Justin Turner CIM, DMS®, CFP®

Justin is a Canadian Investment Manager (CIM), a Certified Financial Planner (CFP®), and a Derivatives Market Specialist (DMS®).  He has extensive knowledge in the fixed income and options markets.  Justin has lived and worked in South America for many years.  In his free time, Justin enjoys spending time with his wife and two dogs.

Eden Wood

Eden has over ten years of business experience, with a background in operations, sales strategy and project management.  She has B.A. in Broadcast Journalism and Fine Art from Hofstra University.  Previously from New York, Eden lives in Toronto with her family.

What do we do?

The Orgil Wealth Management Group of Richardson GMP specializes in constructing, implementing, and managing comprehensive and tax-efficient wealth solutions that are tailored to our clients' specific needs.

Our clients trust and rely on our strategic focus, innovative solutions, integrity, and dedication to providing exceptional service. By utilizing our expertise and backgrounds, we help our clients achieve their goals while exposing them to the least amount of risk. This allows our clients to spend more time on the activities they enjoy, while we focus on managing their finances.

A full service approach:

To identify your objectives, we develop a full understanding of your family background, priorities, goals and objectives. Then, we’ll customize a wealth plan based on our understanding of your unique situation. From there, we’ll develop a comprehensive wealth solution to help you achieve your investment objectives.

It’s important to us to focus on your priorities to enhance and protect wealth.

Our customized solutions include some or all of the following: tax & financial planning retirement planning, estate planning, insurance solutions, business succession, and philanthropy.

To learn more about The Orgil Wealth Management Team, please visit our website at www.orgilweath.com