By Fund Library News Wire | Friday, April 20, 2018
By Mike Keerma
The major North American stock indices held their own on the week, with
S&P/TSX Composite Index advancing 1.4%, as
crude oil gained 1.3%, despite some softness on Friday. With first-quarter earnings
expectations still high, the U.S. blue chip
S&P 500 Composite Index edged up 0.5% week over week, despite headwinds from interest rates as the
yield on the benchmark U.S. 10-year Treasury note rose to near 3.0%, its
highest level since 2014. Yields were fueled by inflationary pressures as
the March all-items consumer price index rose to an annual 2.4%, with the
core rate at 2.1%. A retreat on Friday in both the energy and technology
sectors weighed on stock indices at week’s end, but the
Nasdaq Composite Index
still managed 0.6% uptick on the week, even as
Apple Corp. (NASDAQ: AAPL) slipped, mainly on growing concerns over its flagging iPhone X sales.
We expect the Canadian economy to cool throughout 2018 at a time when trade
risks could further complicate the global outlook. Canada’s economy can
take some reassurance from the relatively firm growth in the U.S., but
indebted households, weak domestic oil prices, still sluggish business
investment and subdued exports all pose challenges.
– I’ve been looking for tax-efficient ways to save for a down payment on
our first home. I’ve heard that a Tax-Free Savings Account is a good way to
save for shorter-term objectives because any growth in the plan is
tax-free, and so are all withdrawals. That seems almost too good to be
true. Can you confirm how this works? – Kim T., Erin, Ontario
Darren McKiernan took over the reins of the
Mackenzie Global Dividend Fund in December 2013 and has done an excellent job, posting above-average
results. For the past three-years (to March 31), the fund posted an average
annual compounded rate of return of 8.1%, placing it in the first quartile
of performance. It has also regularly posted above-average numbers in
calendar year returns. The fund has consequently landed the FundGrade A+ Award for two
years running, in 2016 and again in 2017.
On Dec. 13, 2017, the government released the draft legislation for the
controversial Tax on Split Income (TOSI), noting that it was
simplifying earlier proposed tax measures, which would apply as of Jan.
1, 2018. These amended rules were meant to clarify the process for
determining when and how a family member would be considered to have
made a contribution to the business so as to be exempt from the TOSI
rules. As usual, it’s complicated, so here’s a summary and recap.