Canada’s main stock index ended little changed on Friday, in a year where broader market gains on the exchange have been few and far. 2012, we suggested the index would be challenged to produce growth, the S&P TSX 300 Composite has posted a scant 1.7% return to-date.
For Canadian markets, with consumer debt levels reaching highs nary seen before and deleveraging becoming a must at home and abroad, we expect broader gains will be challenging in 2013 as well. This does not mean we cannot make money in the year to come. In fact, we remain selectively excited as our “Cash is King” theme continues to reign supreme in this stock pickers market.
On a whole, 2012 has been a good one for our research, as we witnessed a wave of M&A activity from our coverage universe, producing seven premium takeover bids from our 2012 Profitable Cash Rich Special Report and 2 more of the 7 new companies introduced into our Small-Cap Coverage in 2012 – The Brick Ltd. (BRK:TSX) and C&C Energia Ltd. (CZE:TSX).
But at this time of year, our thoughts and the thoughts of the market as a whole tend to turn to the holidays. We leave you with the following bit of prose.
‘Twas the night before Christmas, and all through the research house,
Not an analyst was stirring, save that crazy intern Clouse;
All new recommendations studied for 2013 with care,
In hopes that our next great growth stock will be in there;
Our clients were restful, tucked snug in their beds,
While visions of more takeovers danced in their heads;
And mamma with her calculator, and I in my cap,
Had just looked at our 2012 returns, and broke out into rap,
When there on the TV there arose such a clatter,
I sprang from my calculations to see whom I could batter.
Away to the set I flew like a flash,
Stepped on a skateboard and tripped over the trash.
The reporters on CNBC so cheery and upbeat,
Made me sick to the stomach as I fell from my feet,
When, what to my frustrated eyes should appear,
But Fed Chairman Bernanke, and eight empty beer,
With a swig and a wink, so lively and quick,
I thought for a moment, “Who was this old ——?”
More rapid than eagles, his stimulus it came,
And he coughed, and wheezed, and called them by name;
“Now, QE 1! now, 2! now, 3 why not 4!
On, ESL! on XTC! on ABM and More!
To the top of the index! Produce cash and don’t you dare fall!
Now rally away! Rally away! Rally away all!”
And I heard him exclaim, as he drove out of sight,
“PROFITABLE INVESTING KEYSTONE CLIENTS, AND TO ALL A GOOD-NIGHT”
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