Review: Canadian Banks and Select ETFs Performance using Charts

In this post lets take to a look at the performance of the five large Canadian bank stocks and a select few ETFs using charts. This does not involve a deep technical analysis but just a simple review of these charts and making some observations.

1.Performance of five Canadian banks over the past 2 years:
TD Bank(TD) and Royal Bank(RY) have been much better performers than the other three banks. Royal Bank is the most profitable bank in Canada.Hence it is not surprising to see Royal Bank leading the pack together with TD. Though TD has exposure to the US markets thru a Bank North acquisition and the brokerage operation TD Ameritrade, still TD Bank has weathered the current storm better than others.CIBC (CM) reported a huge loss last year due to their exposure to sub-prime assets. Hence CM is lagging the pack.

Related Article:

“NEW YORK — Royal Bank of Canada is seeking to cash in south of the border on Canada’s new cachet as the soundest financial system in the world.

The bank, which has about 450 RBC Bank branches in the southern United States as well as wealth management and investment banking services, launched an advertising campaign a few weeks ago that, for the first time, clearly plays up its Canadian ties.” Canadian banks cash in on new cachet

2. Comparison of iShares MSCI Canada ETF Vs. iShares MSCI Australia ETF:
The Canadian ETF (EWC) is well ahead of the Australian ETF(EWA). This comparison is interesting since these two countries share similar features such as developed western-style democracy, commodity-based economy, blessed with plenty of natural resources, etc. However from the performance above, one can infer that Australian banks and commodity producers were hurt much more than their Canadian peers since Australia is much closer to many Asian emerging markets like China,India, Malaysia, etc. and those countries have been hurt much more than the trading partners of Canada. It must be noted here that the largest trading partner of Canada is the US.

3. Comparison of iShares MSCI Malaysia ETF Vs. iShares MSCI Singapore ETF:
The ishares ETF for Malaysia (EWM) is doing better than the ETF for Singapore(EWS). This could be due to the fact that Singapore’s economy is affected more adversely by the global economy than the Malaysian economy. Besides cargo shipping has fallen heavily since the recession.This has been a major drag for the Singapore economy since the port is a major hub between Asia and the developed world.

4. Comparison of iShares MSCI Chile ETF Vs. iShares MSCI Brazil ETF:
The ETF for Chile is performing better than the ETF for Brazil.The Chilean economy was more resilient to the global economic events than the Brazilian economy.

5. Comparison of iShares S&P; Global Utilities ETF (JXI) Vs. iShares S&P; Global Financials (IXG) ETF:
The above chart shows the difference in the performance of global financials and utilities. While the financial ETF fell as much as 80%, utilities held up relatively well.Hence slow growing but high yielding utilities must be an integral part of a diversified portfolio.

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