Pro Picks: $50 Billion Ideas

Investment Ideas from Brent Joyce, Chief Investment Strategist, BMO Private Investment Counsel

Pro Picks: Three Investment Ideas from a $50 billion Money Manager

Markets are swinging on tariffs, recession talk is everywhere and investors are left wondering what’s real and what’s noise. In this episode of In the Money with Amber Kanwar, Brent Joyce, Chief Investment Strategist and Managing Director at BMO Private Investment Counsel (who oversees $50 billion in assets), shares how he’s navigating today’s uncertainty.

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1. Overweight Canada: Highest Conviction Equity Market

Joyce names Canadian equities as his top conviction pick, citing their value, global reach, and resilience amid shifting economic narratives.

• Improved Tariff Outlook: Canada’s shift from tariff target to a friendlier stance reduces risks and boosts market appeal.

• Undervalued with High Yield: The TSX offers a 3% dividend yield—twice the US’s—and remains “less expensive” than other markets.

• Global Businesses, Strong Performance: Canadian firms like Shopify and banks have global footprints, with the TSX matching US performance over one- and two-year periods.

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2. Likes Sovereign Bonds: A Defensive Anchor

Joyce favors sovereign bonds as a protective asset, capitalizing on their asymmetrical risk-reward profile in uncertain times.

• Asymmetrical Returns: Limited yield upside (25-50 basis points) if economies grow, but 75-125 basis point declines in a recession could yield 6-8% returns.

• Rate Cut Expectations: Global central banks (ex-Japan) are likely to cut rates, pushing bond yields down and prices up.

• Safer Bond Shift: Since February, Joyce has favored government bonds over riskier credit as a “safety valve” amid equity market concerns.

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3. Caution in Europe: Avoid Chasing the Rally

Joyce advises restraint in European markets, questioning the sustainability of their recent outperformance and advocating for profit-taking.

• Tariff Risks Linger: Europe’s protectionist market faces unresolved tariff uncertainties, unlike Canada’s clearer path.

• Valuation Correction: The recent rally reflects Europe’s prior undervaluation, not a structural shift, warranting a neutral stance.

• Diversification Over Hype: Joyce maintains a neutral weighting, emphasizing active stock picking over chasing “European exceptionalism.”

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DISCLAIMERS: The information provided in this podcast is for informational purposes only and does not constitute financial, investment, or professional advice. The views expressed by the host and guests are their own and do not necessarily reflect the opinions of any organization or company. The host and guests may maintain positions in any securities discussed on the podcast. Always consult with a qualified financial advisor or professional before making any investment decisions.