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From February through April each year, federal, provincial and territorial governments typically announce and deliver a budget, defining the financial roadmap for their jurisdiction for the year. Econ...
Liquidity is an important characteristic to consider when aligning security selection with investment objective. The need for capital protection and ability to convert an investment holding to cash is essential for shorter or unpredictable time horizons, but it is less important when investing for a retirement goal 30 years out.
With the Democrats taking both Georgia seats on the U.S. Senate, on January 5, 2021, the major political uncertainties of 2020 were behind us. With only the narrowest of majorities, in the senate and a reduced majority in the house, a unified Biden administration can be expected to push for greater fiscal spending, limited tax increases and regulatory burden and an overall easier political nominations process. But there is no mandate, nor likely majority support for, the more ambitious elements of the progressive policy agenda.
Without a doubt, 2020 was a “loss” year. Individually, we lost the ability to live our normal way of life. Globally, currencies lost their purchasing power as central banks added US$9 trillion to the system (leading to price increases in almost everything, including stocks and properties), and over 1.8 million people lost their lives due to COVID-19.
It’s pretty much a no-brainer to suggest that economic growth in 2021 will be better than what we experienced in 2020. A combination of accommodative monetary and fiscal policy, and the deployment of COVID-19 vaccines will help continue the economic rebound from the March 2020 lows.
Looking at their fixed-income portfolios, investors will no doubt be wondering where returns are going to come from in 2021. Bond yields are extremely low by historical standards. The yield of a diversified Canadian bond portfolio is set to finish 2020 at just 1.2%, the lowest since the bank began tracking Canadian bond yields in 1996 and over half a per cent lower than any previous year.1 In this environment, what role does fixed income play in investors’ portfolios?