Introduction
Enclosed in this edition of the Portfolio Managers’ Notes, we are pleased to share BMO Nesbitt Burns’ latest portfolio strategy report, providing an update on equity markets and insights from our strategist. Additionally, we have included a report on Microsoft, a long-standing holding in our Model Portfolio, which recently announced strong earnings.
In the Wealth Management section, you will find an article on the importance of starting succession planning earlier than you might expect. We have also included an article addressing the emotional toll these conversations can carry. As a reminder, we outlined the key dates and contribution limits for RRSPs, TFSAs, and RESPs. If you have not yet completed your 2025 contributions to your registered plans, we encourage you to do so as soon as funds are available.
We wish you a wonderful remainder of the summer and remind you that we are here to support you. If you have any questions or would like to review your investment portfolio or financial plan, please do not hesitate to communicate with us.
Market Research Investment Strategy - August 2025
More of the Good and Less of the Bad
Global equities performed well over the course of July. The strength can be attributed to a number of factors, but a key driver has been an economic, trade, and monetary policy backdrop that’s had more positive than negative developments of late. For example, U.S. trade policy has become a bit more clear with several deals having been negotiated, economic growth has remained relatively resilient despite pressure in certain industries and some moderation in job growth, and inflation has perked up modestly in some goods but cooled elsewhere. Moreover, central banks continue to suggest they are leaning towards reducing rates in the future even though they have not done so in recent months. In sum, there remain things to be watchful for, but the list of concerns has been shrinking rather than growing.
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Microsoft : MSFT-NYSE
Please contact us to obtain a copy of the full report.
Awesome Azure
Bottom Line: MSFT delivered an impressive quarter across the board, led by Azure’s 39% y/y CC growth in the June Q and the 37% y/y CC Azure guide for the Sept Q. Further MSFT grew operating income 22% y/y CC, helped by only 5% y/y CC op ex growth, despite richer cloud mix. We are raising our target price to $650 and retain our Outperform rating.
Wealth Management
Why succession planning starts sooner than you think
For many business owners, the daily grind of running a company can leave little time to dream about life after work. Yet, shaping a clear exit strategy is as critical as the deadlines you’re facing today. Whether you plan to pass the torch to family or employees or plan to find a buyer, early planning ensures you leave the business on your terms.
To inspire entrepreneurs to approach their future with the same enthusiasm as they do their business, Sheri Griffiths, Senior Vice-President and Head of Ontario at BMO Commercial Bank, hosted a recent event titled “Preparing for the Next Step: Navigating Business Transition.” She was joined by three colleagues from the BMO Private Wealth team: Adam Carter, Vice President, Business Advisory and Transition Planning, Stuart Clark, Senior Estate and Insurance Advisor, and Leigh Vyn, Director, Tax Planning. To round out the conversation, Gary Chung, Managing Director, Middle-Market Mergers and Acquisitions at BMO Financial Group and Taylor Sekhon, Managing Director, Employee Ownership, BMO Commercial Bank, joined to talk what it takes to sell a business in this market and discuss Canada’s newest succession-planning tool.
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The Emotional Currency of Wealth Transfer:
Navigating Complex Conversations
Money is emotional. Within families, differing values, financial literacy levels, and expectations around inheritance can create tension and avoidance. As a result, family conversations about money and wealth transfer often remain superficial – barely scratching the surface.
These scenarios reflect common challenges families encounter when navigating wealth transfer conversations.
Contribution Reminder For Your RRSP, TFSA and RESP Accounts
Maximizing the value of your registered plans by making annual contributions to your Registered Retirement Savings Plan (“RRSP”), Tax-Free Savings Account (“TFSA”), and Registered Education Savings Plan (“RESP”) is an important wealth planning strategy. By making your annual contribution(s) early in the year, you’ll benefit from the tax-sheltered growth all year long.
The contribution amount for 2025 is the lesser of $32,490 or 18% of your 2024 earned income.
TFSA contribution amount for 2025 is $7,000 or cumulative of $102,000 for 2025 if you have never contributed to a TFSA account.
The CRA attributes the problem to delays in processing TFSA annual information returns due to unexpected system issues, with no clear timeline for resolution.
The RESP is an excellent way to save for post secondary education for your children. A contribution of $2,500 to the RESP leads to a combined 30% in government matching savings grants.
Regards,Tim, Catherine, and Edward