Selling on fear? If one doesn't trust management to overcome such profecy, why would one bother buying a piece of their company?ukrainiandude wrote: ↑May 6th, 2017 3:58 pmCanada’s banking system will soon be put to the test.
But don’t take my word for it.
Take it from Prem Watsa, who runs the Canadian investment firm Fairfax Financial Holdings:
Most banks can’t survive a 50 percent drop in real estate values…
It’s going to come down, and a lot of people are going to get hurt.
If you have any money in Canada’s stock market, here’s what you should do.
Lighten up on Canadian housing stocks. If Toronto’s housing market tanks, Canadian homebuilders could severely struggle. Get out of these stocks while you still can.
Sell Canadian bank stocks. This is another no-brainer. If housing prices in Toronto tank, a wave of foreclosures could rip across Canada. Banks and other lenders would take huge losses if this happens.
https://www.caseyresearch.com/articles/ ... oss-canada
I'm way more confident in banks today, given their stress test in 2008. They all got toxic derivatives in their portfolio and they all managed fine. They also managed fine on last real estate crash in the 90s. I certainly hope that their price falls below book value, so I can add more. I doubt a so-called real estate crash will break their business model. As an investor, I don't need to worry about trading techniques to predict short term outcomes. As a trader.... I rely on better signals than attemtping to predict potential outcomes solely based on conflicting sentiment.
May is coming, sell-in-May is a classic, and bank seasonality trends lower from now until October. That simply creates opportunities to increase participation in an oligopoly that has always proven robust.
Successul investing is achieved by managing risk, not avoiding it.