Welcome,


We are very pleased to send you our monthly financial newsletter to keep you abreast of financial markets and world economy. We hope that you will enjoy reading these articles. As always, we welcome your comments and questions.


Sincerely,

 

Team Beauregard Farina Tourangeau

1250 boul. René-Lévesque West

Suite 1500

Montréal, QC

H3B 4W8

Market Returns
              

Value as of

Aug 31 2015*

2015

Year to date

2014

S&P / TSX

13,859

-5.3 %

7.4 %

S&P 500

1,972

-4.2 %

11.4 %

Euro Stoxx 50 

3,270

3.9 %

1.2 %

MCSI emerging markets

819

-14.4 %

-4.6 %

Oil ($US/Barrel)

$ 49.20

-15.4 %

-41.6 %

Gold ($US/oz)

$ 1,133

-4.6 %

-1.9 %

$CAD / $USD

$ 0.75

-12.3 %

-8.5 %

Source : Bloomberg, Richardson GMP Limited

*Values are in local currency

Investment Strategies  

Timing volatility does not work
During market volatility, we should stay invested. That's because time in the market always trumps timing the market. Volatility should always be expected in the markets. Regardless, high-quality companies will continue to grow and create value for shareholders over time. Volatility just creates opportunities for long-term, patient investors. If you look at the TSX over the last five years, the annualized price return has been about 4%. But if you miss the 10 best trading days, you almost entirely wiped out all those gains.

This week's events is a market pause that has helped temper rich valuations and allowed the 'E' in PE ratios to catch up to the fundamentals, which are characterized as decent, not great. 
  
Tax & Estate Planning Strategies 
 
Update on the new rules for testamentary trust
Although upcoming changes to the tax treatment of testamentary trusts will eliminate certain tax-planning opportunities associated with these types of trusts, experts say they still represent valuable tools for many clients.
 
In the news                                     

When does a market turns from Bull to Bear
The stock market's sharp downturn in recent weeks has pulled the three major stocks indexes into what's known as a correction. But when does a market correction effectively end a bull market and usher in a full-blown bear market? A correction is a Wall Street term for when an index like the Standard & Poor's 500 index, the Dow Jones industrial average, or even an individual stock, falls 10% or more from a recent high. A bear market occurs when the index or stock falls 20% or more from the peak.

There have been 19 corrections on the S&P 500 since 1945, not including the current one, and 12 bear markets, according to S&P Dow Jones Indices. That works out to corrections becoming bear markets a little less than 40% of the time.
  
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China confusing currency devaluation
The Chinese government announced it would no longer decide the exchange rate of the yuan. Instead it would set the rate, known as the central parity rate taking into account the closing rate of the yuan the previous day, supply and demand conditions in the foreign exchange market and the exchange rate movement of major currencies.

The new policy is more flexible and more market based. The devaluation could help boost Chinese exports, which would strengthen a weakening Chinese economy, and help China get IMF approval to include the yuan in its basket of major international reserve currencies. 

Read more
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What to expect from the Fed on rates
This month's Federal Reserve policy meeting could signal the end of an era. Policymakers may decide to raise interest rates for the first time since the Great Recession, marking the end of an era of ultra-low rates that has defined financial markets for almost seven years.

Although signs of slowing global economic growth have decreased the likelihood of a September rate increase, many economists still expect policymakers to take action at least once this year as the labour market improves. The Fed has kept its benchmark rate at close to zero since late 2008 to help revive the economy.
 
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Eddy Farina, Fin. Pl., CIM
®
Senior Vice President, Investment Advisor
514.981.5727
 

"  If you only have a hammer,
you tend to see every problem as a nail "
 
- Abraham Maslow
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514.981.5727
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The opinions expressed in this report are the opinions of the author and readers should not assume they reflect the opinions or recommendations of Richardson GMP Limited or its affiliates. Assumptions, opinions and estimates constitute the author's judgment as of the date of this material and are subject to change without notice. We do not warrant the completeness or accuracy of this material, and it should not be relied upon as such. Before acting on any recommendation, you should consider whether it is suitable for your particular circumstances and, if necessary, seek professional advice. Past performance is not indicative of future results. The comments contained herein are general in nature and are not intended to be, nor should be construed to be, legal or tax advice to any particular individual. Accordingly, individuals should consult their own legal or tax advisors for advice with respect to the tax consequences to them, having regard to their own particular circumstances. Insurance services are offered through Richardson GMP Insurance Services Limited in BC, AB, SK, MB, NWT, ON, QC,NB,NS,PEI and NL. Additional administrative support and policy management are provided by PPI Partners. Richardson GMP Limited is a member of Canadian Investor Protection Fund. Richardson is a trade-mark of James Richardson & Sons Limited. GMP is a registered trade-mark of GMP Securities L.P. Both used under license by Richardson GMP Limited.