GLOBAL INVESTING. IS IT TIME TO RELOCATE SOME OF YOUR PORTFOLIO?. Name Title Company DATE. 2. 3. 1. AGENDA. THE BACKYARD BIAS. HAVING A GLOBAL PERSPECTIVE. GLOBAL GROWTH OPPORTUNITIES. THE BACKYARD BIAS. Outside Canada 38%. Canada 62%. CANADIANS HAVE A BACKYARD BIAS.
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IS IT TIME TO RELOCATE SOME OF YOUR PORTFOLIO?
THE BACKYARD BIAS
HAVING A GLOBAL PERSPECTIVE
GLOBAL GROWTH OPPORTUNITIES
Canada62%CANADIANS HAVE A BACKYARD BIAS
CANADIANS HAVE THE MAJORITY OF THEIR ASSETS INVESTED IN CANADA
Source: IFIC mutual fund assets, as of June 30, 2011. Includes Equity, Balanced and Fixed Income Mutual Fund Assets.
CANADA HAS OUTPERFORMED THE WORLD MARKET OVER THE PAST 10 YEARS
Source: Morningstar, Canada as represented by the S&P/TSX Total Return Index, World as represented by MSCI World Index in Canadian Dollars. January 3rd, 200 to December 1, 2011. The chart above is for illustrative purposes only.
CONCENTRATION IN 3 SECTORS HAS HELPED PERFORMANCE OVER THE PAST 10 YEARS
Source: Morningstar, as of November 30th, 2011.
RISE IN DOLLAR HAS MIRRORED RISE IN MARKET
Source: Yahoo Finance. Bank of Canada
December 31, 2001 to December 23, 2011
CANADIAN CONCENTRATION IN 3 SECTORS HAS HURT PERFORMANCE.
Source: Morningstar, as of November 23rd, 2011.
CANADIAN DOLLAR HAS STABILIZED
Source: Bank of Canada as of January 4th, 2010 to December 1st, 2011.
HISTORICALLY CANADIAN OUTPEFORMANCE LED TO LONGER LARGER GLOBAL OUTPERFORMANCE
Difference between S&P/TSX Total Return Index and MSCI World Index ($Cdn) rolling 5 year periods, as of November 30, 2011
Source: Morningstar, S&P/TSX Total Return Index and MSCI World Index ($Cdn). The S&P / TSX Total Return Index and MSCI World Index is unmanaged and unavailable for direct investment. Assumes reinvestment of capital gains and dividends and no taxes. Index past performance is not indicative of future results. For illustrative purposes only.
WORLD BASED ON GEOGRAPHIC SIZE
Source: As of 2008, CIA Factbook for GDP data. Economic size based on GDP Growth Rate. Natural Earth website for shapefiles of the world.
SMALL PERCENTAGE OF THE WORLDS LARGEST AND MOST RECOGNIZABLE COMPANIES BASED ON THE FORTUNE GLOBAL 500 LIST ARE IN CANADA
REST OF THE WORLD
Source: Fortune Global 500, 2011.
6 Largest Companies
CanadaSMALL GLOBAL FOOTPRINT
6 LARGEST COMPANIES IN THE WORLD ARE LARGER THAN THE ENTIRE CANADIAN MARKET
MARKET CAPITALIZATION IN 000’S
Source: Morningstar, Financial Times Global 500.
Canada’s market cap as of Nov 30, 2011. Companies market caps are as of Oct 31, 2011.
THE BEST PERFORMING COUNTRIES CHANGE FROM YEAR TO YEAR
Source: Paltrack, Dynamic Funds. All Indices are represented in Canadian dollars
Mexico – BMV IPC. U.S. – S&P 500 Total Return. England – FTSE 100 Total Return. Canada – S&P/TSX Total Return. Germany – FSE DAX Total Return. Brazil – BOVESPA. France - Euronext Paris CAC 40 PR. Japan – Nikkei 225 Average PR. Hong Kong – Hang Seng Hong Kong Composite.
MarketsCPP HAS GONE GLOBAL
CANADIAN PENSION PLAN INVESTS THE MAJORITY OF THEIR EQUITY PORTFOLIO OUTSIDE OF CANADA
Source: Canadian Pension Plan Annual Report, as of March 31, 2011.
In theU.S.U.S. CORPORATE REVENUE IS DIVERSIFIED
U.S. COMPANIES EARN A SIGNIFICANT AMOUNT OF REVENUE OUTSIDE THE U.S.
Source: RBC Economics, % of revenue of S&P 500 Companies.
U.S. CORPORATE PROFITS
Source: U.S. Department of Commerce, Bureau of Economic Analysis.
PRICE TO EARNINGS LEVELS OF THE S&P 500
Source: Morningstar, November 30th 1999 to October 31st 2011.
THE RISE OF THE DOMESTIC CONSUMER
NUMBER OF HOUSEHOLDS IN CHINA WITH DISPOSABLE INCOME ABOVE $10,000 U.S.
Source: Euromonitor International “Top 10 largest economies in 2020” July 7, 2010
INDIA AND CHINA PURCHASED 70% MORE PASSENGER VEHICLES THAN THE U.S. IN 2010
Source: Time Mag. “Your Next Job: Made in India or China” March 17, 2011
CHINA WILL BUILD ENOUGH SKYSCRAPERS TO FILL 10 NEW YORK-SIZED CITIES BY 2025
Sources: McKinsey & Co. report "Preparing for China's urban billion" March 2009
2012 FORECASTED GDP GROWTH
Source: Goldman Sachs Global ECS Research, Dec. 2010
VolvoYOU’RE ALREADY A GLOBAL INVESTOR
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