Who will replace the fallen? (Banks, that is)
Mr. Market abhors a vacuum just as much as Mother Nature.
If the big U.S. banks are less interested in what you and I would call traditional banking, if many regional U.S. banks are cutting back on lending to shrink their balance sheets so that they don’t have to raise new capital, if some of the biggest overseas and U.S. financial institutions are exiting entire countries, it’s only logical to assume that somebody is going to fill the vacuum.
If you’re an investor interested in making a long-term profit in the financial sector, the only thing you want to know is Who?
I’m going to give you seven names to research and then tuck away until you can buy them at a reasonable price. The rally in the financial stocks since March 9 is no more sustainable than any early lead of mine would be in Sunday’s New York Marathon. But sometime in 2010 I think you’ll get a chance to buy the best names in the post-crisis financial sector. You just have to ready. Read more
Want banks? Have you looked north, lately?
Looking for another way to invest the Canadian Loonie, which I called the world’s greatest currency, in my August 6 post? (See “The world’s greatest currency? The Canadian Loonie gets my vote. And soon some of my money” http://jubakpicks.com/2009/08/06/the-worlds-greatest-currency-canadas-loonie-gets-my-vote-and-soon-some-of-my-money/ )
It’s time to take a serious look at Canada’s banks. Their balance sheets are stronger; the Canadian housing market is closer to a turn-around than that in the United States; and with Canadian regulations keeping non-Canadian competition in the country’s banking sector to a minimum, they’ve free to use their home profits to expand into the much bigger U.S. market.
My favorite among the Canadian banks is Toronto Dominion (TD) because it’s furthest along in its penetration of the U.S. market. That meant it took more of a beating when the U.S. banking market fell into near collapse but it also means the stock has, in my opinion, the most upside.
But you can make a case for most of the big Canadian banks after they announced quarterly earnings on August 27. Read more
Building a Loonie portfolio: 8 Canadian stocks, that is.
Want to give yourself some exposure to Canada’s commodities, Canada’s economy, and Canada’s currency,the Loonie? (See my 8:30 a.m. post today for the reasons that makes sense.)
Here’s a quick eight stock portfolio to buy when the time is right. (I think you’ll get a buying opportunity within the next six months–or much, much less.)
You could do worse than to buy shares of the iShares MSCI Canada Index (EWC). With one buy you’ll pick up three of the stocks in my eight stock portfolio: Toronto Dominion Bank (TD), natural gas producer EnCana (ECA), and fertilizer giant Potash of Saskatchewan (POT). The last two of those are both members of my Jubak Picks 50 long term portfolio.
With the ETF (exchange traded fund) buy you’ll also get exposure to Suncor Energy (SU), Royal Bank of Canada (RY), and Barrick Gold (ABX). Nothing wrong with those picks but if you’re building a portfolio stock-by-stock, I think you can do better. Read more
