There’s a good chance that the COVID-19 pandemic would have delayed retirement plans for several Canadian seniors. Though the stock market has made a stellar recovery since March, Canada is struggling with high unemployment rates, lower consumer spending, and rising healthcare costs.
These extraordinary times have resulted in a volatile stock market. No one is quite sure how things are going to unfold especially as COVID-19 cases are on the rise once again.
Investors might feel the need to guard against these market fluctuations. However, there are common mistakes that should be avoided right now.
Exiting the stock market
If you are closer to retirement age, you might be tempted to sell stocks in your portfolio and exit the equity markets entirely. The market recovery has surprised analysts and experts while some economists are of the view that the rebound is unsustainable given the structural issues impacting global economies.
However, it is better to think twice before withdrawing funds from your retirement account. While it’s ideal to buy the dip and sell when markets peak, it’s impossible to time the equity markets. Further, pulling out investments at the wrong time could cost you dearly; you need to focus on a strategy where you bet on quality companies with huge economic moats.
In the long term, quality companies are well poised to weather macro-downturns and emerge stronger from a crisis.
Retiring when you are not prepared
The ongoing uncertainty might be tempting for several Canadians to postpone their retirement plans. However, this means you will withdraw the money from your retirement account in a market downturn when stock valuations are depressed.
So if you decide to retire and the stock market undergoes another crash there is a chance to lose a significant amount of savings.
Putting investments on hold
Savings for your retirement is a long-term play where you need to disciplined and focused. So, it does not make sense to pause your investments at a time when markets are volatile, which might be counter-intuitive.
Consistently investing for retirement should remain a priority to benefit from compounded gains. You can in fact double down on your investment when the market undergoes a correction and pick up top stocks at a lower valuation.
Retirees can look to buy stocks such as Fortis (TSX:FTS)(NYSE:FTS), a utility company with an attractive dividend yield of 3.7%. Fortis is one of the largest utility companies in North America and over 80% of its annual sales are protected by regulatory mechanisms or from residential sales, largely insulating it from COVID-19 related headwinds.
Fortis managed to increase adjusted earnings by 2% to $0.56 in the second quarter. The company’s earnings were positively impacted by a strong rate base growth of its regulated utilities and higher retail sales at UNS Energy. This was offset by lower earnings in the Caribbean due to a drastic fall in tourism activities in the region.
Fortis is a Dividend Aristocrat and has increased its payouts for 46 consecutive years. With over 3.3 million customers in North America and a steady stream of cash flows, it remains a solid dividend bet.
The company aims to increase dividends at mid-single-digit rates in the upcoming years indicating its balance sheet strength and recession-proof business.
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This Is Where Healthcare Leaders Are Investing Their Money – Forbes
2020 has certainly highlighted the value that a strong healthcare system can provide for a community. Moreover, due to the Covid-19 pandemic, healthcare systems and patients worldwide have turned to more creative solutions in order to deal with crises, deliver care when needed, and innovate as necessary.
Throughout this time, funding and investment in the healthcare industry has by no means slowed down. In fact, the need for innovation in a coronavirus pandemic-driven, socially isolated world has provided even more inspiration for investors to put their money into avenues which can provide viable solutions.
Famed consulting firm PricewaterhouseCoopers and CB Insights recently published a report highlighting the latest trends in venture capital funding for healthcare related industries. These key findings indicate where investors are focusing the majority of their time and efforts, and hence likely portray where the healthcare industry is moving.
In terms of “dollars raised,” the report indicates that Silicon Valley, New England, North Central, San Diego, and the New York Metros are the top 5 regions for healthcare. In Q3 of 2020, Silicon Valley raised nearly $2.5 billion, with New England raising $1.9 billion. But this statistic is not entirely surprising, given the sheer amount of capital and technology talent that’s present in the Silicon Valley area. As some of the world’s largest technology companies are so heavily invested in healthcare, this makes sense. Furthermore, Silicon Valley has always been a “startup” hub, with executives easily transferring their talents from one firm to another, seeking to develop the next innovation. New England is no different, given that it is home to some of the largest pharmaceutical and biomedical innovation companies in the world.
On a similar note, biotechnology is the leading subsector in healthcare investments. In Q3, investors poured nearly $3.9 billion into this subsector, marking an astounding 38% increase from Q2 2020, which raised $2.8 billion. The push for new innovation in biotechnology has never been more prevalent—ranging from new ways to develop and test treatments, to novel technological tools and interfaces for healthcare. The second heaviest area of investment was medical devices and equipment, with nearly $892 million raised.
The largest healthcare deals in Q3 2020 were the following:
a. Bright Health—Value of Deal: $500 Million
b. Tizona Therapeutics—Value of Deal: $300 Million
c. Village MD—Value of Deal: $275 Million
d. Freenome—Value of Deal: $270 Million
e. Thrive Earlier Detection—Value of Deal: $257 Million
f. Recursion Pharmaceuticals—Value of Deal: $239 Million
g. Instil Bio—Value of Deal: $170 Million
h. Kronos Bio—Value of Deal: $148 Million
The last three of these, Recursion Pharmaceuticals, Instil Bio, and Kronos Bio are all listed as biotechnology companies, yet again driving the point that biotechnology leads the healthcare investments realm.
Overall, this report provides a very pragmatic yet illuminating picture of where investors are placing their money and time. Indeed, 2020 has truly ignited a fire in many to continue to innovate to solve some of healthcare’s toughest challenges. However, given the cyclical nature of healthcare, and the fact that new technology continues to drive forward medical innovation as quickly as it can get developed, these trends are by no means stagnant. Rather, as with any legitimate industry that fosters growth, healthcare will inevitably continue to undergo dynamic transformation in the coming decades.
Verv: "Applying for a new investment was tough" – Innovation Origins
When the UK went into lockdown in mid-March, the small Verv team, surprising as it may sound, was well prepared for the turbulent time ahead of them. “In 2019, we had already made significant cost savings after reviewing our business strategy,” says Louanne Steyn, CFO of Verv, “so we had a good overview of all our costs. We knew what we could do to reduce them in the short term.”
For example, Verv canceled the lease of their London office. “We are a small team and now we all work from home. If necessary, we can rent a space to get together.”
Steyn herself works from Devon, southwest of London. “During this pandemic, it is important to cut costs wherever possible and to be intelligent with spending. This will make a difference later on.”
Better focus on product strategy
Verv already had plans to invest in 2020. At the same time, the start-up focused on the latest predictive maintenance technology currently being applied to household appliances such as washing machines, dishwashers and refrigerators. Verv’s technology measures and analyzes the energy consumption of appliances at very high speeds. By applying specialized algorithms to this data, it is able to detect behavioral anomalies that can signal a fault in the machinery. Due to the high resolution of the technology, errors can be detected and prevented in real time, right down to the level of parts of a device.
The solution is available in multiple forms, including built-in firmware on an integrated microchip and an online adapter. By remotely performing a thorough analysis, Verv can provide the manufacturer with a detailed diagnosis and recommendations that can be passed on to repair departments and engineers at the companies involved as well as to consumers who own the device.
With sustainability at its core, Verv wants to offer the market more opportunities to repair rather than replace so that devices and appliances last longer and result in less waste. Steyn thinks that the corona crisis may create new opportunities in the market. “People have less money to spend. They want their things to last longer. Maybe now they’ll start thinking more carefully about the use of raw materials.”
Technology for all electrical products
Manufacturers can integrate the microchip into their devices or devices. But owners of existing devices can also benefit from the predictive maintenance solution. The concept is simple: It uses an online adapter with technology to collect the required data and send it to the platform.
The technology can be applied to any electronic device. “Think of chargers for electric cars where it is important to be able to quickly detect anomalies,” says Steyn. This market is expected to grow due to the need for sustainable transportation.
At one point, Verv was looking for new investments to further develop the technology and prepare for a commercial rollout. “This was a lot harder because investors were first looking at their existing portfolios and were reluctant to invest in new start-ups.”
Re-screened by InnoEnergy
In March, one of the owners of Verv, EIT InnoEnergy, investigated the possibility of reinvesting in some of the start-ups it has in its portfolio. “The process of applying for this was very tough,” says Steyn looking back. “We already knew in 2019 that 2020 would be a challenging year. But corona made that even more difficult.”
Verv further increased its focus on business strategy and product development. At the same time, the company went through the selection procedure set up by the EIT InnoEnergy start-up team. “Now that they have made additional investments, we are in a position to much more easily attract other investors.”
Product delivery likely in 2022
Steyn is happy that Verv is experiencing good traction this year and expects the company to survive the corona crisis. “I have worked for other companies within the circular economy before. I think it’s important to contribute to a more sustainable world with Verv.”
Verv’s business objectives and business strategy will not be greatly influenced by corona, Steyn thinks. Its technology remains on track for mass production, which is likely to start in 2022.
Almost £10m has been lost to investment scams since March lockdown – Yahoo Canada Sports
The Canadian Press
MONTREAL — The Montreal Impact have elected to hang on to some of the club’s top talent, including striker Romell Quioto and goalkeeper Clement Diop, but may soon be parting ways with midfielder Bojan Krkic. The club announced Friday that it has exercised options for 10 players on its roster and opted not to pick up options for another four. Deals on five other players are set to expire at the end of 2020.“All of these decisions are about the financial and sporting sides, and we need to be better,” Impact sporting director Olivier Renard said on a video call. “We need to make the jump.”Some of the options weren’t picked because the club is looking to make space for new players, he added.“We have space to make movement and we will make that as soon as possible,” Renard said.In addition to Quioto and Diop, Montreal is keeping goalies James Pantemis and Jonathan Sirois, defender Karifa Yao, midfielders Clement Bayiha, Mathiew Choiniere, Tomas Giraldo and Amar Sejdic, and forward Mason Toye. The club previously extended loans for defender Luis Binks and midfielder Lassi Lappalainen through 2021.The club did not exercise options on four players, including Krkic, midfielders Steeven Saba and Shamit Shome, and forward Anthony Jackson-Hamel. The decision doesn’t necessarily mean Krkic won’t wear an Impact jersey next season, however. Renard said the club is interested in bringing the 30-year-old Spanish midfielder back, but decided not to pick up his option “for many reasons.” He said the Impact have made Krkic an offer, and the decision is now up to him.Krkic played in 17 regular-season games for Montreal this year, tallying four goals and two assists.Four other players will be out of contract at the end of December, including defenders Rod Fanni, Jukka Raitala and Jorge Corrales. A loan agreement for midfielder Orji Okwonkwo is also set to expire at the end of the year.Raitala, Montreal’s captain, and Corrales will not return next season, Renard confirmed, but the club is still waiting to see if Fanni, 38, wants to continue playing professionally. The moves come after the Impact finished ninth in Major League Soccer’s Eastern Conference (8-13-2). Montreal was eliminated from the post-season with a 2-1 loss to the New England Revolution in the play-in round. The Impact still have at least one game to play in 2020. The team is set to face Honduran club Olimpia in CONCACAF Champions League action on Dec. 15. Players who did not have their options picked up are not required by MLS to play in the game, but Renard said he is hopeful they will join anyway. This report by The Canadian Press was first published Nov. 27, 2020. The Canadian Press
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