Paul de Sousa Explains What the U.S. Election Means for Canadian Investors on Investing News Network
With Joe Biden as the presumed victor and Donald Trump’s current refusal to concede, the 2020 U.S. presidential election has seemingly left more questions than answers for Canadian investors. To gain clarity on the election’s potential effects on the markets and what investors can do to prepare their portfolios, Investing News Network recently spoke with Sightline Wealth Management Senior Vice President and Investment Advisor Paul de Sousa.
According to de Sousa, the U.S. and Canadian markets have typically had a direct correlation, with Canada slowing as the U.S. slows and growing as the U.S. grows. Due to this tie, Canadians will likely have to adjust their portfolios under a Biden administration.
“(Biden will) be taking a much more serious approach toward COVID-19 than Donald Trump has,” he explains. “And so, what that means is volatility, uncertainty, higher taxes again, personal and corporate – even in Canada, we’ll have to pay for this.”
For Canadian investors hoping to hedge this risk, de Sousa recommends going beyond the typical 60/40 portfolio of equities and fixed income. He also urges investors to consider gold as an alternative to fiat currencies.
“Look, the world has not had a successful fiat currency. Right now, I think the two longest-standing currencies are the U.S. dollar and the British pound,” says de Sousa. “But if you look at their purchasing power, they’re abysmal failures in terms of what a dollar would purchase at any point in time in the past and what the same dollar purchases today… gold is that protection.”
Click here to watch the entire Investing News Network segment.