CSTNL - Monthly Newsletter - April 2024

2024-05-06 03:06:00 ET

Summary

• From August 2004 to June 2008, the TSX rose 84% as oil hit an all-time high near $150/barrel. During the same period, the S&P 500 rose a relatively anemic 24%.
• There are three main reasons for the under-performance of the Canadian equity markets.
• Despite these three major negative factors, there are at least two reasons for Canadians to own some Canadian stocks.

By David Baskin

Home (not so) Sweet Home

In 1989, Peter Lynch, the manager of the fabulously successful Magellan mutual fund, wrote a book called “One Up on Wall Street”. The book has never gone out of print and is most famous for one piece of advice: “Buy what you know.” Rather than relying only on traditional financial statement-based analysis, Lynch would go out into the world and observe how people acted, what they bought, and how manufacturers and retailers met their needs. If a particular brand seemed to be doing very well, take a look at the stock. If a car dealer’s showroom was full of stale inventory, run away. This commonsense approach is still in vogue, and the book is still a big seller....

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