insights

Goodreid Blog

Topical viewpoints from our team.

The Financial Post: Consumers hate oligopolies, but this group shouldn't

28 February, 2024

Detective Sherlock Holmes, brought to life by the Scottish author Sir Arthur Conan Doyle, is known for his proficiency with observation, deduction and logical reasoning that borders on the extraordinary. “The world is full of obvious things which nobody by any chance ever observes,” he once said. This brought to mind a question: Are Canadian investors who are enamoured with U.S. equities — and the alluring appeal of the Magnificent Seven — missing some attractive investment opportunities that are much closer to home?

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The Financial Post: Five company attributes you need to look for to invest with confidence

01 February, 2024

By employing these characteristics, investors can build a resilient and prosperous portfolio that reaps many rewards and stands the test of time. The investment industry is rife with predictions on matters such as where the stock market is expected to finish at the end of the year, what securities might perform better than others and how many interest rate cuts we can expect to have. However, humans have proven time and again that their track record of prognosticating future events leaves something to be desired. Subsequently, we at Goodreid do not spend time trying to predict the future. Instead, we spend our energy preparing for specific outcomes.

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Five Lessons Learned from Charlie Munger

19 December, 2023

Billionaire Charlie Munger passed away in November 2023 at the age of 99 after many decades alongside Warren Buffett at the helm of the massive holding corporation Berkshire Hathaway. Together, Buffett and Munger grew Berkshire from a small textiles firm into a massive and diversified conglomerate with a market capitalization of about $780 billion at the time of Munger’s passing.  Over the years I was fortunate enough to attend the Berkshire Hathaway Annual General Meetings (AGMs) in Omaha, Nebraska on a number of occasions. Here are five of the many investing lessons we have taken from Munger over the years.

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The Financial Post: These tax-loss selling targets are also table-pounding buys

23 November, 2023

As we approach year-end, many investors are turning their attention to tax-loss selling, the strategy of selling investments that have experienced a loss in order to offset capital gains and potentially reduce an investor’s tax liability.

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The Financial Post: Banks are taking it on the chin, but here’s why they deserve a second look

26 October, 2023

Canadian banks have long been considered a solid investment choice for a variety of reasons, but perhaps the best thing they have going for them is the oligopolistic nature of the industry. The Big Six — namely Royal Bank of Canada, Toronto-Dominion Bank, Bank of Nova Scotia, Bank of Montreal, Canadian Imperial Bank of Commerce and National Bank — collectively control about 95 per cent of the sector’s market share. Their dominance gives them considerable influence over the economy, including the ability to set interest rates, lending practices and fees for various financial products and services. Their extensive branch networks, robust financial stability and diverse product offerings contribute to their strong market position, making it challenging for smaller banks and new entrants to effectively compete.

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The Financial Post: Just as in baseball, investors can do better by waiting for the perfect pitch

28 September, 2023

Major League Baseball playoffs have arrived, and the best teams will duel it out to be crowned world champions for another year. While history will undoubtedly be made, with exciting walk-offs and bitter disappointments on tap, one thing is and has always been true: hitting a baseball is one of the most difficult things to do in all of sports. But even though it might seem like an art form, hitting is actually more of a science. Take it from Ted Williams, the most proficient hitter in baseball’s history. In 1941, he achieved one of the best batting averages of all time, and one that has not been matched since. He hit 0.406 that year, which is more than four hits out of every 10 at-bats. He was and still is regarded as the best hitter of all time. So, how did he do it? And what can we learn from his approach and apply to investing?

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The Globe and Mail: Dividend investing works wonders - and now’s a great time to start with these three stocks

29 August, 2023

When it comes to investing in a diversified portfolio of Canadian equities, there are usually two choices: a total return Canadian equity portfolio, or a Canadian equity dividend portfolio that generates considerably higher income.

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The Globe and Mail: Why this money manager thinks Canada is the best place to invest over the U.S. right now

12 May, 2023

While many investors look around the world for the best places to invest, money manager Robert Gill believes some of the best bets are at home in Canada, especially now. Mr. Gill, senior vice president and Canadian portfolio manager at Goodreid Investment Counsel Corp. in Toronto, says Canada is cheap with more room for growth. He notes the S&P/TSX Composite Index is trading at about 13.4 times earnings, while the S&P 500 is trading at about 18.6 times earnings, citing Bloomberg LP data as of May 9. Dividend yields are also 3.2 per cent for Canada and about 1.7 per cent for the S&P 500.

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The Globe and Mail: What is Topicus and why it’s a stock pick among our Investing Club members

03 May, 2023

Years ago I was fortunate enough to be invited to Omaha, Neb., to have lunch with Warren Buffett. As Warren sat down beside me at Gorat’s, his favourite steakhouse, I was bursting with questions. After a brief introduction, I asked, “What advice would you offer a young person starting out in the investment business?” He replied by suggesting that the most educationally rewarding experience a new investor could have was to find their own pool of capital to manage, as soon as possible. Do not wait to be given a portfolio to manage; instead, ask your friends and family to invest with you. Consider starting an investment club.

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The Demise Of SVB

15 March, 2023

Banks are only viable institutions with the trust of their customers. Banks rely on deposits to fund much of their business activity, such as commercial loans, mortgages and other debt offerings. Because they are vital to the economy, governments oversee and regulate banks rigorously. However, in this age of digital access, the concept of “a run on the bank” is quite different than it was 90 years ago at the start of the Great Depression, when as old photos illustrate, long lines of people formed to wait their turn to withdraw their money.

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Now is the time to consider TC Energy for your portfolio

03 March, 2023

TC Energy Corp. (TRP-T) has recently fallen out of favour with investors, but we believe this would be the right time to add the energy infrastructure company to any investment portfolio. TC Energy transports oil and natural gas through 90,000 kilometres of pipeline across North America. It delivers energy to millions of people, connecting growing supply in the most prolific production regions of the continent to refineries and key end-markets. The company has a very stable business. So what happened, and why are we looking at it now?

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The Portfolio Roadmap

23 February, 2023

There is a tremendous amount of commentary these days about the future of equity markets. Much of this talk is focused on what can be termed, “top down” issues, for example the geo-political tensions around the world or whether the economy will stall in the face of higher interest rates. But “bottom up”, company-specific analysis rules the day in the long term. Using a car road trip as a metaphor, focusing on the fortunes of individual companies to create a portfolio will determine your end destination, while those top down, macro issues will affect the route to your destination.

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Baseball And Investing: Waiting For The Right Pitch

13 October, 2022

October baseball is here, where the best of the best teams in Major League Baseball duel it out to be crowned champion of the world for another year. And while there will be history made, exciting walkoffs, and bitter disappointment (sorry, Blue Jays fans), one thing is and has always been true – hitting a baseball is one of the most difficult things to do in all of sports. So what can we learn from it and how does it apply to investing?

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McKesson (MCK-NYSE) - A Stock for the Times

29 August, 2022

Our new position, McKesson (MCK-NYSE), provides healthcare solutions in the United States, primarily through drug distribution. As such, it is relatively insulated from bouts of waning consumer confidence and has little exposure to the negative effects of an appreciating U.S. dollar.

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Patience and Perspective

27 June, 2022

Having managed professionally for over three decades, those of us at Goodreid have learned a few lessons. One of the most important teachings of the market is to live with, and respect, the process. Economies and their pricing tool, the equity market, naturally cycle, searching and adjusting to reach a perfect balance between supply and demand. Throughout this process the system spends almost all its time out of whack, with either a growth or contraction bias. Living with this imbalance means accepting with grace and having peace of mind during both upcycles and downcycles. 

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Goodreid welcomes Robert Gill, Canadian Portfolio Manager

26 April, 2022

Robert is joining Goodreid from a prominent Investment Counsel firm, where he was Canadian Equity Portfolio Manager to institutional and high net worth clients.  “We are excited to have someone of Rob’s calibre join the Goodreid investment team”, said Mr. Reid. “His approach and track record clearly illustrate his strong understanding of investment management, and in particular, the Canadian equity market”.

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Capital Gains – Love ‘Em and Hate ‘Em

28 March, 2022

Who doesn’t like a gain? But the reality of many financial gains in this country is that you have a silent partner – otherwise known as Canada Revenue Agency (CRA). CRA’s piece are the taxes we pay. There are many exceptions to taxes on gains on capital (most notably in Canada on principal residences), but the purpose of this blog is to focus specifically on gains on the sale of publicly-traded shares.

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What Worked in the U.S. Markets in 2021

10 December, 2021

After a screaming hot run for growth stocks off the pandemic-led economic and stock disruptions of March 2020, value investing made an impressive comeback in 2021. This has thrown equity managers for a loop, with only 40% of U.S. equity managers managing to outperform the S&P 500 Index this year.

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Timber! Brookfield & West Fraser Timber

03 May, 2021

For anyone wondering how likely it is that lumber prices will stay at current levels – roughly 4x the 35 year average price, and 197% above any prior cyclical peak, pre-2018, a recent announcement by Brookfield Asset Management tells us everything we need to know about that particular question.

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CURA And The U.S. Senate

06 January, 2021

CURA has rallied nicely over the past 3 months in lockstep with political developments in the U.S.. Shares picked up strong momentum when Joe Biden won the Presidency in November and gains continued as the U.S. Senate polls turned to favour the Democratic Party in Georgia.

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Five Myths About the Market 

05 November, 2020

In an internet age it is easy to find information on just about anything, but often it can be difficult to determine what’s fact and what’s fiction. Here we will discuss 5 myths about the market today. 

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Are Stocks Expensive?

18 August, 2020

A common assertion made by investors these days, both novices and pros alike, is that stocks are expensive after the fastest and sharpest recovery from a bear market in modern history.

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Shopify: Canada’s Latest & Greatest in a Long String of Shooting Stars

14 May, 2020

We’ve likely all heard by now the breathless media accounts of how Shopify last week overtook Royal Bank as the largest company in Canada with a market capitalization of $127B.

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A Note To Our Clients

16 March, 2020

I’m writing to you in this time of market volatility to provide reassurance that Goodreid is maintaining its long-established investment approach and to give our perspective of the current state of the financial markets.

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Banks & Mortgage Stress Tests: Fuelling The Fire

19 February, 2020

This week, the federal government announced that it is changing the stress test rate for insured mortgages starting April 6th. Good news for the banks. Bad news for aspiring home buyers.

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Bringing Home The Bacon

18 December, 2019

That’s exactly what the U.S. consumer is doing for the economy. In a $22 trillion cauldron, consumption makes up about 68%, or $15 trillion of U.S. GDP.

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Saudi Aramco IPO: Fun Facts

11 December, 2019

Saudi Aramco is +10% in its first day of trading after the IPO which raised $25.6B USD.  Today’s price values the company at $1.88T USD…somewhat below the Prince’s aspired for $2T, but a princely sum nevertheless.

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A December To Remember

04 December, 2019

Of course, that phrase has become familiar because of a car ad on TV, but its applicability to the stock market in December of 2018 was undeniable.

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What We Learned from Canadian Banks Q1 2019 Earnings

05 March, 2019

Canadian banks are important…not just to Goodreid’s clients (although they are very important to us, comprising nearly 20% of our Canadian portfolio), but to the overall direction of the S&P TSX Composite Index...

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Don’t be ‘P.O.d’ by Your IPO

08 November, 2017

Investment lore tells us that “there’s gold in them there hills”, when it comes to initial public offerings (IPOs) of stocks. Surely everyone has heard stories of those fortunate enough to “get in on the ground floor” of McDonalds, Microsoft,...

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Goodreid Turns 30

26 September, 2016

Today marks the thirtieth anniversary of an investment approach developed to aid investors who were searching for a path to long-term wealth creation.

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In Defence Of Active Management

18 August, 2016

On August 4th, the Globe and Mail reported that just 17% of large-capitalization equity fund managers in Canada outperformed their benchmark in the second quarter, which proved to be the worst quarter for active managers in at least 17 years.

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Trust The Math

12 February, 2016

Market corrections are uncomfortable. Investors’ emotional responses are rooted in the worry that a catastrophe will occur.

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Investing, Not Gambling

03 September, 2014

It seems that every time I look at the Business section of a newspaper or tune into a Business channel someone is asking whether we should “take some off the table”. This bugs me on a couple of levels.

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