The Best Performing Stock Index of 2007 Will Be…
Thursday, February 8th, 2007
By Michael Lombardi, MBA for Profit Confidential
As most of my readers are American, they are likely unfamiliar with the S&P/TSX Composite. This index is basically the Canadian equivalent of the NYSE Composite or the Dow Jones Industrial Average. Some of the largest companies in Canada are listed in the S&P/TSX Composite.
I write about this index often because I believe if you’re not already invested in the S&P/TSX, you should be. The TSX was one of the world’s best performing stock markets in 2006. So far this year, in only six weeks, the S&P/TSX is already up 6%. Why the big gain?
The TSX is laden with precious metal and resource stocks. And, with investors continuing to turn to gold and other precious metals, the TSX continues to boom.
I’ve often written about my fondness for gold stocks. The TSX is home to the listings of some of the largest and best-managed gold producers in the world. As precious metal prices continue to rise, so will the TSX. As oil prices rebound, the TSX moves higher too.
With daily trading of about $6 billion, the TSX trading volume pales in comparison to the NYSE. But the exchange does offer good liquidity for large companies, many of which are American based in the first place and listed on the TSX as a secondary exchange.
If I had to pick one exchange that would rank as the best performer of 2007, it would be the TSX. Interest rates in Canada remain very low, and they are not expected to rise any time soon. Americans looking to diversify their portfolios, both as a hedge against the U.S. dollar and a play on gold bullion’s price rise, should consider the TSX. Most brokers in the U.S. can buy stocks on this exchange.
NEWSFLASH — Europe’s biggest bank, HSBC, reported yesterday that it is increasing its loan-loss provisions for 2006 as mortgages to risky U.S. borrowers are “going bad” at a faster clip than the company originally estimated. More proof the U.S. housing market is in trouble.
Next Post: One of the Hottest Alternative Energy StocksPrevious Post: My Advice is to Remain Cautious
Tags: gold, gold prices, gold stocks, interest rates, U.S. dollar
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Michael bought his first stock when he was 17 years old. He quickly saw $2,000 of savings from summer jobs turn into $1,000. Determined not to lose money again on a stock, Michael started researching the market intensely, reading every book he could find on the topic and taking every course he could afford. It didn’t take long for Michael to start making money with stocks, and that led Michael to launch a newsletter on the stock market. Today, Michael only employs the top market analysts and editors. Some of our recommendations have posted gains in excess of 500%! Michael has authored and published over one thousand articles on investment and money management. Along the way to building Lombardi Publishing Corporation, now with over one million customers in 141 countries, Michael became an active investor in real estate, art, precious metals and various businesses. Readers of the daily Profit Confidential e-letter are offered the benefit of the expertise Michael has gained in these sectors. Michael believes in successful stock picking as an important wealth accumulation tool. Married with two children, Michael received his Chartered Financial Planner designation from the Financial Planners Standards Council of Canada and his MBA from the Graduate Business School, Heriot-Watt University, Edinburgh, Scotland.Follow Michael and the latest from Profit Confidential on Twitter
