22:18:16 EDT Thu 16 May 2024
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Globe says we might as well stick with sluggish TSX

2024-03-04 08:58 ET - In the News

The Globe and Mail reports in its Saturday edition that the TSX Venture Exchange may be a flop, but it is our flop. The Globe's Tim Shufelt writes that more than a decade has passed since the heady days of the commodity supercycle, when insatiable demand for resources vaulted the TSX to global prominence. The Canadian market has been a disappointment ever since, left in the dust of a monumental bull market that took root in the fallout of the global financial crisis and was merely interrupted by the COVID-19 pandemic. The Canadian benchmark index has now trailed the S&P 500 in eight of the past 10 calendar years. Over that time, U.S. returns have outpaced Canadian by a factor of more than 2.5 to 1. Why should anyone stake their financial well-being to such a perennial laggard? Well, it turns out there is strong case for investing heavily in one's home market, even if that market happens to be the TSX. On a longer time horizon, even bad decades smooth out. Canadian benchmark stock returns dating back to 1970 are pretty much the same as U.S. stocks have posted -- in the 10- to 12-per-cent range. There is little choice but to stick with the TSX. It may not be the stock market we would like, but it is the one we have.

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