Insights: Everybody is winning

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June 12th, 2021

The recent rally in the bond market has sparked debates on which investing style is going to win in the second half of the year. Will growth stocks return to favour or will value stocks continue their 2021 outperformance? The answer appears to be yes. The combination of endless Federal Reserve easy money and plenty of fiscal stimulus appears to be providing the fuel for just about all asset prices to surge. When the leading group gets exhausted, others pick up the pace so that the leaders can catch a rest before getting back into the race.

That seems to be the case with the Energy sector. After a spurt in the first two months of the year, it took a breather before climbing to new highs in June. The bull run does not appear to be over. Last week, two of our morning report stocks, June 10th and 11th, were oil patch stocks. However, they were not the biggest gainers of the week. That distinction went to our June 9th report which featured a Canadian cannabis stock that is already up 17% since the report. So long as bond yields remain on hold, there is a good case to be made that just about all assets could benefit from the Fed's easy money, at least in the short term. The Federal Reserve could throw cold water on a rally when it releases its next monetary policy statement on Wednesday. We view this as a small risk.

The Canadian energy ETF broke out at the start of June (click for larger)

Meanwhile, the battle between the cryptocurrency bulls and bears is heating up on INK Ultra Money. On June 8th Aswath Damodaran gave a fantastic Real Vision interview on value versus price. His take on bitcoin, however, was not so impressive in our view. At the very least, his timing was off as he dismissed bitcoin's case as a currency right before El Salvador passed a resolution accepting the cryptocurrency as legal tender. A few days later on June 11th, Guy Swann of Bitcoin Audible provided a counter-narrative that bitcoin is the codification of Austrian economics. Joey Krug, co-CIO of Pantera Capital provides a more comprehensive rebuttal to Damodaran in our video clip of the week.

This week's insights newsletter is a bit shorter than usual as we work behind the scenes to move INK into the next phase of its development. Part of that involves more direct video content, so make sure to check the INKResearch Twitter feed around 7 pm Pacific Time Sunday to Thursday for our summary of the next day's morning report.


Top 3 Gainers Last Week

Company NameStock Symbol1 Week Return %
Peyto Exploration & DevelopmentPEY22.9
TranscontinentalTCL.A16.0
Birchcliff EnergyBIR4.0

Top 3 Losers Last Week

Company NameStock Symbol1 Week Return %
VersaBankVB-9.6
Sierra MetalsSMT-6.5
Hudbay MineralsHBM-5.4

Returns are as of the last trading day of the previous week.

Featured Clip

Insider of the Week

Grant Fagerheim, President, Director, and CEO of Whitecap Resources (WCP)

We believe Whitecap Resources CEO Grant Fagerheim has the distinction of being the first CEO in the oil patch to deliver a net-zero carbon emissions year in the oil patch. That was in 2019. We will have to see how they did last year, and we will not have to wait long. We expect Whitecap will be delivering its 2021 sustainability report within the next week. Although the company is not promising a net-zero repeat any time soon, in our view they are clearly heading in the right direction at the right pace. Whitecap is demonstrating a sense of urgency in getting to net-zero, and we suspect their share price will be rewarded for their climate leadership.

INK Canadian Insider Index

1 Year Total Return Performance


Historical Performance

Annualized Total Return as of June 11, 2021 04:49 pm
1 Year 82.31%
3 Years 10.06%
5 Years 11.23%
10 Years 9.64%


To learn more about the Index please visit
https://index.inkresearch.com

5 Year Total Return Performance


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