Mike Philbrick, CEO, ReSolve Asset Management
FOCUS: Exchange-traded funds
Top Picks: Harvest Equal Weight Global Utilities Income ETF, Fidelity All-in-One Equity ETF, CI Galaxy Ethereum ETF
MARKET OUTLOOK:
The U.S. stock market remains a focal point, with exchange traded funds (ETFs) receiving $150 billion in inflows, a level not seen since 2021. This surge accompanies a record-setting advance in the S&P 500 Index, up over 26 per cent in 2024, pushing valuation metrics like the price to earnings (PE) ratio into the ninetieth percentile of the past 40 years. While some call this irrational exuberance, historical precedents remind us that the market can defy expectations longer than skeptics predict.
Economic indicators show resilience. Core inflation has moderated, allowing the U.S. Federal Reserve to maintain rate stability, reminiscent of the late 1990s. Strong job markets and declining initial jobless claims further support a narrative of steady growth. However, a slight uptick in inflation raises concerns about potential rate hikes. The yield curve inversion and tightening credit conditions suggest a cautious outlook, with the risk of recession still on the horizon.
Globally, geopolitical tensions, notably the U.S.-China dynamics and Middle East unrest, add complexity. Meanwhile, sectors like utilities, and managed futures strategies offer diversification opportunities. Managed futures, in particular, have shown value during volatile markets, providing a layer of portable alpha and risk management.
Investors should remain vigilant, balancing optimism with preparation for volatility. Diversified strategies and thoughtful allocations to uncorrelated assets may help navigate this dynamic environment.
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TOP PICKS:
Harvest Equal Weight Global Utilities Income ETF (HUTL.XTSE)
HUTL provides diversified exposure to global utilities through an equal-weight approach, focusing on high-quality, dividend-paying companies. With an active covered call strategy, it enhances income potential, making it ideal for investors seeking consistent returns. The utilities sector’s dependable demand and steady performance in varying economic conditions further strengthen this ETF’s appeal.
Fidelity All-in-One Equity ETF (FEQT.XTSE)
FEQT delivers a globally diversified equity portfolio with a focus on long-term growth. Its construction includes a mix of traditional equity assets and a small allocation to Bitcoin futures, offering exposure to both established markets and emerging opportunities. This blend makes FEQT appealing to investors seeking broad diversification, potential capital appreciation, and a measured approach to digital asset inclusion.
CI Galaxy Ethereum ETF (ETHX/B.XTSE)
ETHX/B offers direct exposure to Ethereum, a leading blockchain platform powering smart contracts and decentralized applications. With a focus on holding Ethereum directly, this ETF provides investors with a simple, regulated way to access the growth potential of the digital assets space. The rising adoption of blockchain technology and Ethereum’s evolving role in decentralized finance make it a compelling choice for those seeking innovation and diversification.
| DISCLOSURE | PERSONAL | FAMILY | PORTFOLIO/FUND |
|---|---|---|---|
| HUTL.XTSE | N | N | N |
| FEQT.XTSE | N | N | N |
| ETHX/B.XTSE | N | N | N |
Past Picks: DECEMBER 7, 2023
The Ether Fund (QETH-UN.XTSE)
- Then: $37.41
- Now: $61.90
- Return: 65%
- Total Return: 65%
The Horizons Global Uranium Index ETF (HURA.XTSE)
- Then: $34.92
- Now: $40.58
- Return: 16%
- Total Return: 17%
The Cambria Emerging Shareholder Yield ETF (EYLD.CBOE BZX)
- Then: $29.87
- Now: $33.06
- Return: 11%
- Total Return: 15%
Total Return Average: 32%
| DISCLOSURE | PERSONAL | FAMILY | PORTFOLIO/FUND |
|---|---|---|---|
| QETH-UN.XTSE | Y | Y | N |
| HURA.XTSE | N | N | N |
| EYLD.BATS | N | N | N |