Exciting Updates and Market Insights

We’re pleased to share some updates about our practice and provide key market insights following our attendance at the Fidelity Investments annual conference.

1. QSA Wealth Management: A New Chapter

Our rebranding as QSA Wealth Management reflects the growth of our business as Quinn takes a more active role in the practice. We’re also excited to announce that our website, qsawealth.com, is now live!

We want to emphasize that nothing changes in how your financial affairs are managed:

• Your investments: Whether held through Fidelity, IA, CI, or other leading providers, your investments remain securely managed with no changes to the fund allocations or strategies you rely on.

• Your insurance products: Insurance policies you hold through Manulife, IA, or other providers continue to be managed exactly as before, with no changes to your coverage or service.

QSA Wealth Management is simply the umbrella under which we deliver a full range of financial services, allowing us to bring you tailored solutions to meet your evolving needs.

Our rebranding does not alter our commitment to providing exceptional service. The website will also feature regular updates to keep you informed and supported on your financial journey.

2. Market Insights from Fidelity Investments

At the recent Fidelity conference, we gained valuable perspectives on the current economic and market environment. Here are the main takeaways:

• Economic Resilience: Fidelity does not anticipate any major obstacles in the economy in the near term, signaling ongoing opportunities for growth.

• Investment Cycle: We are likely in the 7th inning of this investment cycle. While cycles can extend significantly, they can also end abruptly for unforeseen reasons.

• Canada’s Challenges and a Weakening Dollar: Canada’s economic growth continues to lag behind U.S. and global markets, and the Canadian dollar is likely to remain under pressure. This reinforces our strategy to reduce exposure to Canadian investments in favour of U.S. and international markets, which has been critical in driving strong portfolio performance. Despite travel becoming more expensive with a weaker dollar, clients with significant global exposure benefit from currency gains, as non-Canadian investments appreciate with a declining CAD.

• Global Opportunities Outperform: U.S. and international markets continue to present stronger investment opportunities compared to Canada. This is a key reason why we have maintained an underweight Canada approach in portfolios.

• Fidelity’s Leadership: Fidelity continues to demonstrate unmatched breadth in investment products and exceptional talent among its portfolio managers.

3. Mark Schmehl: Insights from a Leading Growth Manager

One of the highlights of the conference was the keynote presentation by Mark Schmehl, manager of Fidelity’s flagship fund, Global Innovators. For our more aggressively inclined investors, Mark has been second to none in delivering extraordinary results.

Mark remains focused on the growth side of the market, adapting to emerging trends. Here are three key insights from his presentation:

1. Shifting to AI Applications:
   Having capitalized on AI infrastructure and chip manufacturers, Mark is now focusing on AI application developers, which he sees as the next long-term growth opportunity.

2. An Accidental AI Discovery:
   Mark shared how, years ago, while living in Silicon Valley, an aide spotted a flyer for a free AI presentation. Curiosity led Mark to attend, where he encountered pioneers of the AI revolution. This early exposure convinced him AI would transform the world. He immediately began buying Nvidia and other AI infrastructure stocks—pivotal moves that shaped the fund’s exceptional performance.

3. Post-Election Tesla Trade:
   After the last U.S. election, Mark made a bold move, becoming one of the largest buyers of Tesla stock the following morning.

   Mark’s Rationale: He believed the election results would likely favour Elon Musk and Tesla, creating a more conducive environment for innovation and electric vehicles. Mark anticipated that regulatory and market conditions under the new administration would further enhance Tesla’s leadership in the EV market, justifying the significant investment.

This decisive trade has been a key driver of the fund’s recent success and reflects Mark’s ability to quickly analyze macroeconomic and political trends to inform his investment strategy.

Mark continues to exemplify what makes Fidelity’s talent pool unparalleled. His insights and strategies remain invaluable for long-term aggressive growth portfolios.

4. Reflecting on Recent Market Performance

Many clients have experienced substantial growth in their portfolios, particularly those invested in aggressive growth areas like Fidelity Global Innovators.

A common question we hear is: What should we do now that our portfolios have grown significantly? While we have never been proponents of market timing, there are options for those who may wish to shift to a more diversified and balanced approach.

One excellent alternative is Fidelity Global Equity +, which offers a more comfortable investment experience without sacrificing growth potential. This fund brings together three of Fidelity's finest investment managers, each with unique investment styles and philosophies:

1. Mark Schmehl (Global Innovators): Focused on high-growth opportunities, including AI and disruptive technologies.

2. Hugo Lavallee: Known for his quality growth approach with a focus on innovation and sustainability.

3. Dan Dupont: A value-oriented manager with a focus on capital preservation and downside risk management.

This 1/3-1/3-1/3 approach provides unparalleled diversification, combining growth, quality, and value strategies in a single investment. For those heavily invested in Global Innovators, this may be a great way to balance portfolios while maintaining exposure to Mark’s exceptional insights.

We’re happy to discuss this option in detail and how it fits into your long-term plan.

5. Always Here to Support You

As always, we’re committed to providing you with the highest level of service. Whether you have questions about your portfolio, financial planning, or any other financial matters, please don’t hesitate to reach out.

We look forward to continuing to work with you and helping you achieve your financial goals.

Warm regards,
Steve and Quinn

Mutual funds, approved exempt market products and/or exchange traded funds are offered through Investia Financial Services Inc.

The comments contained herein are a general discussion of certain issues intended as general information only and should not be relied upon as tax or legal advice. Please obtain independent professional advice, in the context of your particular circumstances. This update was prepared by Steve Arial who is an Investment Funds Advisor at QSA Wealth Management, a registered trade name with Investia Financial Services Inc., and does not necessarily reflect the opinion of Investia Financial Services Inc. The information contained in this presentation comes from sources we believe reliable, but we cannot guarantee its accuracy or reliability.