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Dec 10, 2014 9:38 PM Heathbridge Capital Management
Or at least you were as of the end of today.
The precipitous drop in oil prices is having a calamitous effect on confidence on world markets, particularly in Canada, where oil is a heavily weighted staple in most portfolios. Some natural gas stocks like Encana (which we don’t own) are down 50 percent from their levels in the summer of this year! Railroads, which have benefitted from the transport of oil in a time of pipeline constraint, are down sharply and even bank stocks are being hit because of their loans to the oil patch. The headlines are horrifying.
Our recent presentations in December focused on the value of diversification and balance through international exposure. As a consequence of this policy, our average equity portfolio is higher than at the end of September and October. We are in a position to watch these developments with interest and maybe even excitement if there is a panic sell off in the next few weeks. We are in a position to buy.
While it is likely you will experience some value erosion in the next little while, you are still in pretty good shape. We know that the markets can be nerve-wracking and would welcome your call if you need some comfort.