THE WORLD IS CHANGING… ARE YOU CHANGING WITH IT?
After outperforming U.S. markets 8 out of the last 10 years in Canadian dollar terms (2002-2011), Canadian markets are now on track for their second straight year of under performance. For many reasons, it would seem that Canada’s market leadership run may have come to an end. At the same time, the outlook for markets outside Canada are improving and may offer greater future opportunities for investors.
Why Invest Outside Canada?
- Emerging markets such as China, India and Brazil continue to build middle class consumers. This is expected to rapidly increase global consumption over the next 15 to 20 years.
- Investors who want to profit from this trend will have to identify what these consumers will be demanding and what companies will be able to take advantage of their buying habits.
- These new middle class consumers aspire to live as the rest of the developed world does today… drive the same cars, eat the same food, and wear the same clothes. They desire a more affluent lifestyle and will seek out the products they associate with that type of living. This provides an opportunity for many well-known consumer companies, based out of the U.S. and the rest of the developed world, to profit from this growing demand. Attached is an investor presentation that highlights the positive outlook for global markets.
What’s a Conservative Investor To do?
Conservative investors looking to add more U.S. and/or international exposure to their portfolios, can focus on investments that pay a portion of their return in cash. Investments that pay a regular cash flow such as dividends and interest payments can provide more consistent returns, often with less volatility. We suggest the following funds for your more risk adverse investors looking to access growth opportunities outside of Canada with a lower level of volatility.