Despite a vigorous rally today (TSX Composite Index was up 252 points or 2.3% and the S&P 500 went up 26 points or 2.1%), pretty much every equity market around the world is well off the recent highs. While the sharp slide is unnerving, a correction or a bear market provides many opportunities to find bargains. I don’t know if the markets are going to go up or down from here but many securities are cheaper now than they were just four to six weeks back. Here’s what is on my shopping list:
- Emerging Markets: The iShares MSCI Emerging Markets Index Fund (EEM) has fallen about 20% from its peak.
- Developed Markets: I already have some exposure to international stocks through the iShares MSCI EAFE Index Fund (EFA). It is off 11.5% from its highs, so this might be a good time to increase my exposure to this asset class.
- US Equities: I still think that large-cap, blue chip US growth equities are reasonably priced. The DJIA slipped 6% compared to an 11% correction in the TSX Composite.
- Selected Canadian Equities: Some Canadian blue chips are getting interesting. I would be interested in the Bank of Nova Scotia (TSX: BNS) below $42.
Warning: This or any other post on this blog is not a recommendation to buy or sell securities. It’s your money, so please do your own due diligence.
