Sometimes I know I’d like to reach out and strangle the markets and how they work. Can’t they just go up for a while?
It seems as though we’ve been stomaching ups and downs in the markets for years (well… actually we have) and it doesn’t seem like it’s over just yet. With that being said, if you’ve been listening to the news you’ll hear a lot about Europe and how dire the situation is over there… well if you think like I do, you realize this is a very good thing.
It seems that the public opinion out there is stating you need to run away from Europe… it’s going to implode. In the history of markets, when everyone is running out you should be running in. Put another way: “Be fearful when others are greedy and greedy when others are fearful.” It’s Warren Buffets way to fortunes… but you have to be patient. The next few years are not going to be smooth.
As a well known fund manager Edmund Shing stated “If you are a long-term retail investor, with an investing horizon of years not months, then there are two reasons [to buy European Stocks]: 1) valuation, and 2) Europe is not condemned to recession, contrary to the consensus.”
This is what we have been doing with our clients over the past year. We haven’t been dumping all our money into Europe, but we are starting to hold more and more global investments. This will allow us to be invested when Europe actually hits bottom (maybe it already has?). This may not be tomorrow but has Shing suggested… “Europe is not condemned to recession.”
The quotes from this article have come from one of our industry newsletters (Globe Investor). You can find the full article by clicking here.
I was also at an economic seminar with one of our major suppliers (Standard Life Investments) this past week and the sentiment is the same. Now is the time to take advantage of markets that have been beaten up. The companies in economies around the world have a lot of cash and significant cash flow. These companies are paying out massive dividends to their owners. Become an owner and take advantage of their profits.
If you are not a client and want to hear more about this contrarian way of thinking please call Travis Strain at 604-308-6030, or email me at mail@travisstrain.ca
Travis
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