Money has moved out of the Bond market, and into large cap defensive equities.  They are defensive in terms of the volatility of their cash flow,  but there comes a time when they are less defensive.  He thinks that there are specific stocks that are worth adding to a portfolio. Something that has a strong balance sheet that can survive a slow growth market, but still able to grow if the market improves.

Doesn't see a correction in the near future, and if we do pull back, that represents a buying opportunity

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His investment style is value driven, staying away from the index. So very low banking and resource exposure. Tends to invest in sectors that are underrepresented in the index. Won't be talking about banking and resources because, resources are very volatile, and there are better opportunities then banks for dividend yields. The world stock market is anticipating too optimistic an economic scenario. China is devaluing their currency, US is pumping money into the economy and it's barely growing. Try to avoid companies that depend too much on export market. Tend to stick to domestic companies that rely on the Canadian economy. The European and German money is starting to come to Canada these days.

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Canada is dominated by energies and financials and also the gold sector. He feels that financials have relativily weak earnings going forward. Energies depend on the keystone pipeline being built. Gold has been under a huge strain, gold has been "more or less washed out".

In the US the market is doing very well, up 15% year to date. Will likely continue to do ok.

Large cap investers in Canada need to think long term, 3 to 5 years. Find companies that trade below average multiple of earnings relative to their long term averages. Look for earnings growth and dividend growth in their forecast for the company. If all three things are good then they will take a position.

You don't want to concentrate in any one sector, you should have 6 or 7 sectors to be diversified.

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GOLD: Gold has had a wild ride. This is due to three reasons: 1) Central bank sales and the potential bank sales out of Cyprus. 2) ETF sales, retail investors dumping ETFs for equities. 3) downgrade of central prominant investment banks.(ie. Goldman Sachs)

Bullion seems to have found a new floor. There has been a huge supply shock coming into the market. He is surprised that it has done as well as it has. There are buyers coming from the Asian markets.

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Natural Gas: This is a shoulder season for natural gas, she doesn't foresee a lot of gas coming out of storage in the next few weeks. We will just have to keep our eye on gas prices.

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Educational segment 30 year treasury yield, if yields get above 3.5 percent he feels that the bond run isn't over.  He fields that bonds are a better bet over stocks for the next 4 quarters. Inflation is the number one fear of bond holders.

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We are dealing with two kinds of economic growth.  Developed economies delivering of financial institutions. Second type wasn't mentioned.

We are in a low interest rate environment and we have coordinated fiscal policy trying to stimulate economic growth and in the US create jobs.

Self fullfilling prophecy of stimulated economy providing long term growth.

Some emerging markets central banks are moving away from export based growth to domestic consumption.

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Markets. Slow growth economy is good for corporate profits.  Any incremental growth goes to the bottom line.  Now there is no alternative.  Everyone has thrown in the towel and is into equities.  You have to own the profitable companies.  Resource stocks don’t fall into that category.  Resources are cheap now but you have to do something defensive.  There is a ton of oil going into the US hub and that is the problem. 

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