Schmidt Azam Wealth Management - ScotiaMcLeod Scarborough

Investments 101/Market Update

Financial advisors know that education is important in helping you determine, build and maintain your long-term investment and financial plan. Some pieces are specific to certain kinds of investments while others are more general in nature. We will provide some articles of interest that we hope you will find informative.

Education is not the filling of a pail, but the lighting of a fire.
Wiliam Butler Yeats

Guide to Canadian Convertible Debentures

Investment advisors saw the supply/demand picture for Canadian convertible debt stabilize in late 2004 and 2005. New issues, while still selling out on a regular basis, no longer saw the massive over- subscription, trading volumes, or price appreciation of the previous year and a half. Convertible bonds have seen more interest recently as a way to earn higher yields while potentially participating in an increase in equity prices. Convertible bonds are an interesting way to invest in quasi-equity securities that have many of the benefits of bonds.

Guide to Preferred Shares

With financial institutions recapitalizing through 2008, investment advisors have faced a great deal of new preferred share issues with various structures coming to market. The more common "hard retractables" of the past are becoming rare as banks and investment houses reach farther out on the yield curve and deeper through the capital structure of the companies. Preferred shares can be important sources of income for many investors, but the risks and rewards should be understood. Preferred Guide 2009

Forecast Update

Key economic trends for 2009-10 are likely to include a moderation and continued repositioning of global economic activity, lower and leaner for longer. Financial advisors are toning down growth expectations and growth is expected to slip to an average of about -1.2% for Canada and -2.1% or less in the United States. While the pace of activity also may be a bit less frenetic in Asia, China should stay on a positive growth track, with India and Brazil also showing decent growth. Inflation is expected to remain muted. For information on the Government of Canada's action plan, please click here: http://www.gc.ca/home.html and click on Canada's Economic Action Plan tab on the right. For the latest Forecast Update, click here Global Forecast Update April 9 2010.pdf

The Tax-Free Savings Account (TFSA)

Financial advisors understand that the Tax-Free Savings Account (TFSA) will not likely represent the sole investment or savings vehicle for investors. We recommend that you use this vehicle as a shelter to tax returns that are taxed at the highest marginal tax rate or as a vehicle that is used to shelter capital gains from active investment management. TFSA

Bank Capital Instruments

Canadian financial institutions have been active in raising money in the marketplace and there have been investment securities called Capital Trusts (or CaTS) that have been created to help position this funding in the capital structure of the bank. This report will help explain these new capital securities in greater detail. Bank Capital Trusts