Friday, September 23, 2022
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How to pick ETFs during volatile markets

Darren Gazdag, regional sales director for Emerge Canada Inc., agreed that it has been a challenging time and advisors are looking at opportunities, depending on their risk tolerance. Even though the Fed has been relatively aggressive in hiking interest rates, he expects inflation to eventually abate.

Trevor Cummings, vice president of ETF distribution at TD Asset Management Inc., said technology ETFs are inherently deflationary. “Technology is a really interesting part of the market these days,” he said, “because, as rates have climbed, the pricing model of a particular technology company changes.”

While that has caused some discomfort for investors in the short run, he said, “this is one of those back to basics kind of markets: everything in moderation. I don’t think people should abandon fixed income in the context of rising inflation, but you’ve got to be more creative about it.”

Cummings also recommended advisors be more active than passive, but warned “you have to pick carefully, of course: there’s a much wider range of outcomes. So, it’s doing your due diligence and making sure you know who your partners are and what solutions you’re putting into your portfolios and how they’re going to interact with the rest of what you’ve already got in there.”



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