October 2023 Newsletter

Money is a tool. It's something that supports your life!

Fall Photo Contest!

The fall photo contest continues into October! If you have a photo that reminds you of all things great about the fall, we'd love to see it! (I'm partial to tiny dogs in Halloween costumes, myself!)

You have until November 3rd to send in your photo to Ashley.Nichols@nbpc.com - Please submit your email with the Subject: Fall Photo to be entered for a $100 gift card to a restaurant in your city!

The winner will be chosen at random and announced in our November Newsletter. Good luck to all who enter!

 

Planning Tip: FHSA - First Home Savings Account

The FHSA cn be used by first-time home buyers to contribute up to $40,000. Like an RRSP, contributions are tax deductible, and qualifying withdrawals are tax free. Unlike the RRSP HBP (Home Buyers Plan), the account holder doesn't need to repay the money that has been withdrawn.

 

To open a FHSA account, the application must be a resident of Canada and at least 18 years of age. They must be a first-time home buyer - meaning that they have not lived in a home that was owned, either solely or jointly with their spouse or common-law partner at anytime in the calendar year before the account is opened, or at any time in the preceding four calendar years.

A FHSA matures and must be closed (with related proceeds either used to make a qualified purchase, transfer tax-free to an RRSP or RRIF, or were drawn on a taxable basis) upon the 15th anniversary of the individual first opening a FHSA, or by the end of the year in which the account holder turns 71.

 

Our Portfolio

We hope you continue to listen and enjoy our monthly podcasts. Please send us in any questions you may have that you'd like us to talk about in future episodes!

September lived up to its reputation for delivering poor returns.

With S&P 500 down 4.7%, Nasdaq 100 down 5.1% and bonds down 2.6%.

The markets have been on a bumpy path and the month of September exhibited echoes of 2022 with both stocks and bonds falling in tandem. Longer-term interest rates have marched upward as the intersection of massive Treasury issuance, structural changes, and Fed messaging of higher for longer short-term rates all put upward pressure on the long end of the yield curve. The structural changes pushing long-term rates higher include a tight labor market and an inflation environment that, while improving, is also unlikely to return to levels that prevailed between 2009 and 2020. As the market begins to recalibrate to higher interest rates, it is gradually realizing that the post-2009 Financial Crisis period of low inflation and rock-bottom interest rates was likely the anomaly.

 

At the beginning of the month, we took profits on both Canadian and US stocks that had performed well and trimming Apple, Royal and TD. We initiated small positions in various US (TKY, TSCO, MSFT, GS, MDLZ, DIS) and Canadian stocks (ALA, CU, GFL, ONEX, PKI, WSP). This increased our cash posltion to 25%.

 

 

Returns on our 60/40, 70/30 and 80/20 portfolios before fees:

 

Interesting Charts

Source: X @unusual_whales, September 13, 2023

Technical Comments

https://www.brookstradingcourse.com/price-action-trading-blog/

• The September monthly S&P candlestick was a big bear bar closing near its low.
• Last month, we said until the bears can create strong bear bars with follow-through selling, odds slightly favor the market to still be in Always In Long.
• The bears managed to get follow-through selling in September testing the 20-month EMA.
• They see the prior rally (Jul 27) as a retest of the all-time high and want a reversal from a lower high major trend reversal.
• September was the first pair of consecutive bear bars since last year (Sept 2022).
• The bears will need to create more follow-through selling closing far below the 20-month EMA to increase the odds of a reversal down.
• Previously, the bulls managed to create a tight bull channel from March to July.
• That increases the odds of at least a small second leg sideways to up after the current pullback.
• They see the pullback in August and September simply as a test of the Feb 2 breakout point, the 20-month EMA and the bull trend line.
• The bulls want the 20-month EMA to hold as support. They see the current move simply as a deep pullback within a broad bull channel.
• They want a retest of the July 27 high followed by a breakout and a test of the all-time high.
• Since September’s candlestick was a bear bar closing near its low, it is a sell signal bar for October.
• The S&P 500 may still trade at least a little lower.
• Traders will see if the bears can create more follow-through selling closing below the 20-month EMA.
• Or will the market trade slightly below the 20-month EMA but reverse to close above it by the end of the month?
• For now, until the bears can create consecutive strong bear bars trading far below the 20-month EMA, odds slightly favor the market to still be in Always In Long

Millennial Minute

As we near the end of 2023, and inflation sees no cooling on the horizon, we are left to do what we can with what little we have.

This month we continue to revisit Millennial Budgeting Tips, and this month is about prioritizing essential expenses and re-evaluating discretionary spending. 

Times are changing, and the way we think about our money needs to change with it. Read this month's article to learn more about how to stretch your dollar where possible, how to shop more responsibly, and how to try and save yourself when no one else is able to (or willing to). 

And please share this article to anyone you feel may benefit from these articles. Even if you aren't a Millennial or younger, everyone can benefit from some light reading!

 

Click here to read more!

 

More Planning

Six Tips for Talking to Adult Children About Your Family's Wealth

The great wealth transfer has arrived. Reportedly, US$84 trillion globally will get passed down to future generations over the next two decades. Whether it be investments, cash, real estate, businesses or other assets, having the discussions now with those who will inherit and build on your legacy lays the foundation of trust and understanding. 

While these conversations can be uncomfortable, don't let the discomfort stop you from educating your kids on what you envision your family's legacy will look like. 

 

Click here to read more!