Friday, January 10, 2020

This week's interesting finds

January 11, 2020

Our Q4 commentaries are available now
This quarter, portfolio manager Andrew Pastor explains his investing journey (and what he learned to forget along the way), while portfolio manager Frank Mullen discusses finding positives in a negative-yield environment. 

Canadian energy makes the world a better place (en) (fr) 
A short video that reinforces the benefits that the Canadian energy industry, directly and indirectly, brings to all Canadians.

Canada has an abundance of natural resources that can fuel our nation yet we are importing resources daily from countries that take advantage of us, and that do not share the social values or legal standards that we demand from ourselves. 

Canada should be a world leader in supplying the most responsibly sourced energy not only to ourselves but to other parts of the world as well.

Streaming and cloud services are soaking up huge amounts of energy
A researcher at Huawei Technologies Sweden expects the world's data centers alone will devour up to 651 terawatt-hours of electricity. That is equivalent to the energy produced from Canada’s entire energy sector. This researcher also suggests that global data centre energy demands will double over the next decade and will represent 11% of global energy consumption by 2030.

What's driving the increased demand for data? Streaming video is currently the biggest culprit, with platforms like Netflix and Amazon Prime Video eating up 61% of all internet traffic.

The million-dollar age grid
This grid shows at what age you can become a millionaire, based on your yearly savings and when you start saving. This grid assumes you start with $0 and your savings are invested at 7% annually.

If you start saving $24,000 every year starting at age 30, you will have one million dollars by the time you are 50, or if you start saving $10,000 a year, by the time you are 60.

 Efficiently concentrated through ETFs
One of the primary drivers of the boom in ETFs over the last decade is that they provide efficient diversification.  While that’s the theory, the reality is that a number of the biggest sector ETF’s aren’t that diversified at all.

Investing in “the market” or a specific sector is increasingly becoming a concentrated bet on a few large names.
Would you believe that the two largest holdings in two sector ETFs account for more than 40% of the entire ETF?  That’s right, in the Energy sector, the top two holdings (Exxon and Chevron) account for just under 43% of the entire ETF, while Alphabet and Facebook account for 41.8% of the Communications Services sector.  In the Tech sector, Apple and Microsoft account for just under 40% of the ETF.