Better returns in world markets

Money Reporter, MPL Communications Inc.
133 Richmond St.W., Toronto, ON, M5H 3M8. 1-800-804-8846

 

Canada and the TSE are only a small part of the world markets picture, which is one reason we should always hold some of our equity allocation in non-Canadian stocks. A second reason for diversifying outside the country is that Canada lacks some industries that are available elsewhere in the world stock markets. But the most compelling reason is that you can improve your overall return while reducing your overall risk.

Take the U.S. for example. This past four weeks, Canadian stocks were up 0.59%, while the Dow Jones Industrial Average was up 3.18%, the S&P 500 was up 2.56%, and the Nasdaq Composite was up 1.22%. The Canadian dollar was down 0.73%, which makes those returns even better.

Or look at the year to date. The Dow is up 22.59% in 2013, the S&P 26.54%, and the Nasdaq 32.20%. The Loonie is down 5.47% this year, while Canadian stocks are up a relatively meager 8.40%.

This past month China’s Shanghai Stock Exchange has been going crazy. It has gained a ridiculous 48.98% in four weeks, which is by far the best among the major markets in the world. Second place was taken by Tokyo’s Nikkei, up a more reasonable 9.18%. Finland’s HEX was up 5.24% for third-best market.

On the downside, Brazil’s Bovespa fell 2.50% for last place.

Money Reporter, MPL Communications Inc.
133 Richmond St.W., Toronto, ON, M5H 3M8. 1-800-804-8846

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