Briefly:

(October 30, 2006) UBS Investment Research is urging investors to stay in equities and resist the temptation to move into cash, at least for the remainder of 2006.

The TSX and S&P 500 have sailed through the last three months with barely a hint of the vulnerabilities that typically present themselves in these months, the report notes.

“Going forward, the issue for investors is whether these gains will be reversed, or whether the equity markets’ traditional seasonal strength between November and May will dominate,” UBS says. “The data strongly supports the latter conclusion.”

Both markets usually post strong gains in the final two months of the year, UBS adds, predicting 12-month targets for the TSX and S&P 500 at 13,250 and 1,500, respectively.

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RBC in partnership with new Chinese fund company

(October 30, 2006) Royal Bank of Canada announced Monday that it has entered into a joint venture agreement with China Minsheng Banking, a commercial bank headquartered in Beijing, to launch a new Chinese fund management company in Shanghai.

The company will create, manage and sell mutual funds in local currency to retail and institutional investors in China.

Under the terms of the agreement, RBC will hold a 30% interest in the venture, China Minsheng Bank will hold a majority 60% interest, and China’s Three Gorges Finance will hold a 10% interest.

“This exciting initiative provides us with an entry point into the rapidly expanding Chinese asset-management market,” says George Lewis, CEO of RBC Asset Management.

RBC says its China strategy involves making targeted investments in global debt markets, global financial institutions, private banking and fund management. To that end, the bank upgraded its representative office in Beijing to offer branch banking services last February and opened a new RBC Life Insurance Company representative office there last August.

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AIC cuts minimum investment on pools

(October 30, 2006) AIC is significantly lowering the minimum initial investment required to purchase the fund company’s Private Portfolio Counsel pool family.

Effective immediately, minimum investment in the pools will be $250, down from $25,000 for mutual fund units, Class F Units and Class T Units. In a release, AIC said it was making the change in response to advisor and investor needs.

“These funds offer four of North America’s leading value investing managers — AIC Limited, Third Avenue Management, Ariel Capital Management, and Loomis Sayles & Company. We believe that lowering the initial investment threshold into the AIC PPC Pools will enable an even greater number of Canadian investors to have the opportunity to access these best in class managers, each offering proven track records in capital preservation and growth,” says AIC CEO Jonathan Wellum.

AIC also announced Monday that is changing the equity weightings in AIC PPC Balanced Income Portfolio Pool and AIC PPC Balanced Growth Portfolio Pool.

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Dundee, Scotiabank launch new deposit notes

(October 30, 2006) Dundee Securities Corporation and Scotiabank have launched the Bank of Nova Scotia Dundee AdvantagePlus Focused Income and Growth Deposit Notes for conservative Canadian investors. They are on sale until December 15.

The notes offer exposure to a portfolio of common stocks and income trusts, plus a principal-protection guarantee if the notes are held until maturity, which will be in December 2012.

Available on a yield basis, where income distributions from the portfolio are paid out to investors, and on a total-return basis, where distributions will be reinvested, both products will initially invest in a portfolio of 15 income-generating stocks and income trusts.

Scotiabank will pay selling commissions of $4.25 per note ($100) out of the offering proceeds. Early trading or redemption charges range from 5.5% in the first year to 1.5% in year three. Minimum investment is $5,000.

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Inhance seeks environmental advancements at Suncor

(October 30, 2006) Responsible investing specialist Inhance Investment Management is calling on Suncor Energy to eliminate all greenhouse gas emissions from its oil sands operations by 2020.

“Suncor’s oil sands production is a major Canadian energy resource, with the potential to seriously impact Canada’s climate,” says Inhance vice-president Dermot Foley. “By investing in ethanol production, wind power and research in carbon dioxide reduction technology, the company is working to reduce those impacts.”

However, Foley says the Vancouver-based fund firm, which owns shares of Suncor through its Canadian equity fund, believes the energy giant can do much more.

Citing a report from the Pembina Institute, Inhance notes that greenhouse gas emissions from oil sands operations can be neutralized for as little as $2.50 US per barrel.

“By taking meaningful early action, Suncor can avoid the need for drastic emission reductions to compensate for delayed government and industry action,” says Foley. “This will be good for shareholders and the environment.”

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