In this One Chart, we compare the volatility profile of 1.25x the Solactive Canadian Bank Mean Reversion index (SOLCBMRT) – which the Hamilton Enhanced Canadian Bank ETF (ticker, HCAL) seeks to replicate before fees – to that of the Big-6 Canadian banks. We believe HCAL is a good choice for long-term investors, as its modest leverage offers the potential for higher returns in a steadily growing…
Insights: Region
U.S. Financials: Why They Remain Attractive (Especially the Mid-Caps)
[All values in U.S. dollars unless otherwise noted] One year on from the market depths of the pandemic, it is worth a quick review of how far the U.S. financials have come. Notwithstanding the fact Ontario recently entered another province-wide lockdown, things south of the border look far brighter, especially for the holdings in the Hamilton U.S. Mid/Small-Cap Financials ETF (tickers: HUM, HUM-U) and much of…
Canadian Banks: Are Analysts Underestimating the Recovery (Again)?
In our October webcast, “Canadian Banks – Credit Cycle is (Basically) Over”, we correctly predicted that reserve builds for the Canadian banks would peak in Q4-20, and that the recovery would begin in Q1-21. In fact, we launched the Hamilton Enhanced Canadian Bank ETF (HCAL)[1] in October 2020 to give investors a vehicle to capitalize more fully on this recovery while at the same time benefiting…
Canadian Banks: Q1-21 Takeaways – One Catalyst Down, Two to Go
In October 2020, we launched the Hamilton Enhanced Canadian Bank ETF (ticker: HCAL), a modestly levered version of our Canadian bank mean reversion strategy ETF (ticker: HCA), in anticipation of a credit-driven recovery for Canadian bank earnings and stocks. In our view, with its 25% leverage, HCAL offers investors an opportunity to benefit as the recovery gains traction (in the near-to-medium term), as well as for…
Video: Canadian Banks – Three Potential Catalysts for 2021
Watch Rob Wessel, Managing Partner of Hamilton ETFs, give an update on three potential catalysts for the Canadian banks in 2021.
Fintech/Cdn Banks: Can Standalone Digital Banks Disrupt the Incumbents?
In the coming weeks, we will publish a series of insights on financial innovation discussing several powerful secular trends relating to financial technology/innovation and its impact on the global financial services sector. We will also review how these trends influence the investment strategy of the Hamilton Financials Innovation ETF (HFT). Part I: Can Standalone Digital Banks Disrupt the Incumbents? Part II: Four Themes Driving Innovation in…
U.S. Banks: The Return of M&A – A Clear Sign of Bankers’ Conviction in the Recovery
All values in U.S. dollars unless otherwise noted. As the year draws to a close, the whipsaw nature of 2020 will not soon be forgotten. When the pandemic struck earlier this year and businesses shuttered under direct orders by various governments, how long and how deep the resulting global economic downturn would be was next to impossible to forecast with any sense of accuracy. As businesses…
Canadian Banks: Q4-2020 Takeaways – Recovery Has Started; What’s Next?
In late October, with earnings season approaching, we wrote an insight entitled, “Canadian Banks: Will Q4 Be a ‘Clean-up’ Quarter?”. In that note, we predicted the banks would take steps to accelerate their return to normalized earnings by: (i) building reserves against performing loans (by to $2-$3 bln, to ~$25 bln) in order to prepare for defaults coming in 2021, and (ii) pulling forward expenses, possibly…
Video: Canadian Banks – Key Takeaways from Q4 Earnings
Watch Rob Wessel, Managing Partner of Hamilton ETFs, give an update on the Q4 2020 Canadian bank earnings season:
Hamilton Financials Innovation ETF: Invest in Digital Leaders Reshaping the Financial Sector
When most investors think of the financial sector, they think about the traditional financial subsectors, like commercial banks, investment banks, and insurance. However, the rapid advancement of technological innovation has created an entirely new category of financials and transformed others. In our view, this category has become so large and established that it should comprise a material portion within all investors’ financial sector equity allocations. Not…
Global Financials: The Most Attractive/Important Investment Themes in 2021
Hamilton Global Financials ETF (HFG), which launched on June 26, 2020, is focused on investing in high quality global financial stocks with strong balance sheets, diversified income streams and exposure to favorable, medium- and long-term cyclical and secular trends. This focus aims to provide Canadian investors with diversified exposure to the most attractive themes within the global financial sector while maintaining a volatility profile not materially…
BNN Bloomberg: ETF provider launches ETF with exposure to Canadian banks saying huge loan-loss provisions are ending
Rob Wessel was on BNN Bloomberg today to discuss the Canadian banks, potential releases of loan loss reserves, and the Hamilton Canadian Bank 1.25x Leverage ETF (HCAL), that launched on October 15, 2020. Click here to watch the interview.