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Hedging
Trump's been talking about the US being self-sufficient on energy. It's not actually true. When you look at how many barrels of oil the US produces, it's about 14M a day. They consume about 20M barrels. They need to import a lot of heavy crude. They need Canadian oil, despite what he says.

How this will impact Canadians in on the value of the CAD. We're 3% of the world. When most people look at their investment portfolios, the vast majority of exposure is in the US (over 60% of the world's capital markets). So it matters what the CAD-US rate is, especially in registered accounts.

Today the CAD is trading around $1.42. Short-term interest rates relatively drive a lot of capital flows. If you back out crude oil, Canada actually has a deficit to the US. If we can hammer that point home to the US during CUSMA negotiations, we can gain a lot of ground.

Correlation between the interest-rate differential and the current value of the CAD is much more of a factor recently than what's happening with oil prices. We have a more hawkish Fed, a BOC that probably still needs to cut rates, and a structurally weaker economy here in Canada. It's debatable whether PM Carney's policies will drive foreign investment into Canada.

Very rare for the CAD to hold above current levels. So, for a lot of investors in registered accounts, look to switch your exposure in ETFs to hedge that foreign currency. He encourages people to check out the related links on his blog.

The oil price has returned to pre-war prices. So, the market will shift attention to the U.S. 10-year bond yield. That yield has risen to 4.5% in recent weeks; typically at this level, forward market returns are muted. AI stocks are insulated, but all other areas, namely growth stocks, have seen downward pressure. He expects the U.S. 10-year to come down and broaden out the rally. Falling oil and gas will lead to lower inflation expectations. Meanwhile, rent prices are starting to roll over, which will lead to tailwinds for core CPI.

It's her favourite REIT, which enjoys tailwinds now. Pays a 10% dividend. Managed well.

Hits April 2025 highs. Fundamentals have been improving since last quarter. Healthcare is defensive, attractive now. Is happy to hold on. Has been great for him.

Is near August 2024 lows. Is still operating very well, but inflation is eating into profits. Don't need to rush into this.

Sentiment changed on this, falling. She sold a lot of shares on the way down. She loves what they do--they are the ultimate, original AI software company. They are executing. Is happy to hold the rest of her holding.

Over a 3-year horizon Canadian equities are a good place to put capital, but outside of the resource space. This avoids being exposed to commodity price volatility. As well, a lot of the Canadian market is exposed to financials, and the banks are doing quite well.