The Canadian Investor - Investment Accounts Simplified and 5 Stocks on Our Radar

Episode Date: December 8, 2025

Simon and Dan kick off this episode with a clear, beginner-friendly walkthrough of the main Canadian investment accounts. If you’re not sure which account to pick or you need a refresher, the first half of this episode is for you. TFSA, RRSP, FHSA, RESP, taxable and locked-in accounts, Simon and Dan go over how they work, when they make the most sense, and the biggest pitfalls to avoid (like TFSA over-contributions and RRSP withholding tax surprises). It’s a perfect primer to share with friends and family who want to start investing but aren’t sure which account to use.  If you’re already familiar with these accounts, in the 2nd half of the episode Simon and Dan go over 5 stocks on their radar. Tickers of stocks discussed: WSP.TO, TIH.TO, PD.TO, TECK-B.TO, TSM   Check out our portfolio by going to Jointci.com Our Website Our New Youtube Channel! Canadian Investor Podcast Network Twitter: @cdn_investing Simon’s twitter: @Fiat_Iceberg Braden’s twitter: @BradoCapital Dan’s Twitter: @stocktrades_ca Want to learn more about Real Estate Investing? Check out the Canadian Real Estate Investor Podcast! Apple Podcast - The Canadian Real Estate Investor  Spotify - The Canadian Real Estate Investor  Web player - The Canadian Real Estate Investor Asset Allocation ETFs | BMO Global Asset Management Sign up for Fiscal.ai for free to get easy access to global stock coverage and powerful AI investing tools. Register for EQ Bank, the seamless digital banking experience with better rates and no nonsense.See omnystudio.com/listener for privacy information.

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This has to be one of the biggest quarters I've seen from this company in quite some time. Welcome back to the Canadian investor podcast. My name is Simon Belanger. I'm back with Dan Kent. We are back for a regular episode. We'll do things a little differently here, so we'll have the first part. where we'll go over a quick overview of the different type of investment accounts. So the previous Monday we went over the three things you should do before you start investing.

And now we'll go over the different types of accounts where people are starting to invest. Now, if you've been listening to us for a while, that's completely fine because on the second part of the episode, we'll do stocks on our radar. So we have a couple of them each that I think will be really useful to people. But even if you've been investing for a while, we're getting at this time of year where you're probably going to have family dinners. You're going to be talking to friends and family maybe going out for some drinks with some friends that you haven't seen for a while. And maybe you'll have some friends that know you're investing and they'll be interested in learning more about investments in general, the type of accounts. So you can refer them to this episode because we will go over the most common type of accounts. It's not a super detailed overview, we'll give the big highlights of each account. But I think it's a good primer for people starting to invest. And especially as we get new listeners in the new year, we can always refer people back to this episode. So they know the types of accounts that are available to them and kind of the pros and cons of each. Not that we'll do pros and cons,

but the advantage is, let's just say, for each. Yeah, there's a lot of different types of accounts so you can kind of open up when you're just starting out. So it'll be a good, you know, high level overview for the most part. There's going to be one account that's probably most beneficial to beginners. But I mean, depending on your situation, it can change. So, yeah, it should be a pretty good overview. Okay, let's start with the TFSC, one of the accounts that's still widely misused. If you ask me, constantly see that in surveys.

A lot of financial surveys from the big banks, for example, come out every year. and it shows that a large portion of TFSA holders hold significant amount of cash within that account. A lot of people sometimes are not even aware that you can hold other investment like stocks, like bonds, like ETFs in that type of account. So you want to go over what it is, again, at a higher level. Yeah, so this is kind of the account that I mentioned for beginners. For the most part, it's probably going to be the best account to start investing in. there is some rare instances where, you know, if you're just getting started and maybe you have a higher level of income, RRS could be a solid bet, but, or, you know, we talked about this on the before you started investing the employer matching. That could be another situation. But if you were 18 in 2009, you've actually accumulated around $109,000 worth of TFSA room as of the start of 2026. So it does carry over. And it's, it's an account where your contributions, they give you a set amount that you, you can contribute every single year.

Your contributions that you put into the account, you don't get a tax credit for them, but any earnings inside of the account, any capital gains, dividends, anything like that is tax-free. It's also tax-free when you withdraw. So the room that you get in the TFSA every single year,

it's inflation linked and rounded to the nearest $500. So if you're ever wondering, and you got a chart here, like why the room goes up at, you know, seemingly random periods of time, like you'll have three years where it's a set amount, then it goes up. It's because it is inflation, you know, kind of linked to inflation.

So once inflation hits a certain point where the room should go up and they round it to the nearest $500, they'll kind of bump that room up. And that's also why during, you know, the COVID period of time, like 2022 to 2024, you see in a raise almost every single year because we had that high, high level of inflation. And unlike an RSP, which you'll go over next, when you withdraw from a T of a say you're not tax. So you don't get tax deductions, but you also don't pay tax when you pull it out. And I mean, I would say, you know, the final point is this is kind of the only investing account that I would say like doesn't lose its luster, I guess, as you age. Like regardless

if you're 18 or or 81, you still get that room every single year. Your returns and withdrawals are tax free. There's no force withdrawals like like say an RSP where they force you to convert it or, you know, as your income drops might not be as beneficial. So this is, it's a pretty important account. And like you said, a lot of people, I mean, might not even be aware that you can invest in it. I mean, obviously, it's kind of a bad name for an account like this, like the savings account. It should really be. And I mean, this is cliche because absolutely everybody says this, but, you know, a tax-free investing account would probably be a better name. But yeah, it's a great account. Yeah, and probably just the last thing of no to keep in mind. So if you end up winning the

lottery and you want to max out your contributions, you just have to be careful if you do withdraw. some money from the account. You can't go beyond the maximum that you have available. You'll regain that room that you've withdrawn the following year. So you can't withdraw and be at the maximum contribution, say, in March, and then think you can re-contribute three months later. If you're already at your maximum, you'll have to wait the following year. That's probably the biggest thing left to keep in mind.

But then again, if you're just starting, it's probably unlikely that you would encounter that. Yeah, that was the other thing. I guess I'll say you're probably not likely to encounter this if you're just beginning. But if you go, a lot of people use the CRA's website to determine their TFSA room, which is, I mean, it's so it's very outdated. Like it's not updated very often. Like for people who've over contributed to this to their TFSAs, like 99% of the time, it's because they log in to their my CRA account. And it says they have $7,000 worth of room. But what they don't realize, it was updated like nine months ago. they've already contributed. So keep track of your TFSA room manually. Exactly. And I think what the CRA does is they will just do it once a year. And they'll do it after financial institutions send them the information. So usually they'll update it.

I think it's like February or March because I think financial institution have to send the information by the end of February. I know that's a rule for RSP. So I'm assuming it's the same for TFSA. And I don't believe they would do any of their. updates until the following year. So just keep that in mind. Always best to keep track on your own of the room,

especially if you're close to that limit. If you have tons, sums of room, then just maybe having a rough idea. That's fine if you're, you know, you're $50,000 away and you intend on maybe contributing $1,000 a month.

I think you can rest assured that you'll be okay. But now let's move on to RSP to keep, go over all the important accounts here and not take a full hour to do it. RSP, different from TFSA, TFSA, you contribute with after-tax dollars. RSP is kind of the opposite. So you contribute with pre-tax dollars. It's essentially a tax deferral account so you don't pay tax now. You pay tax when you actually withdraw the money whenever that is.

When the money is within the RSP, it is tax-free for the gains. It becomes taxable income when you withdraw the money. Ideally, you contribute when you are at a higher tax bracket and you withdraw when you are in a lower tax bracket. But again, there's no way in predicting that. And that's been one of the things that I've been putting a lot of emphasis in the past is that TFSC gives you a lot more certainty in terms of taxation. Sure, you can make some assumptions down the line, but that is one of the bigger advantages, in my opinion, of the TFSA. you can contribute to an RSP for the first 60 day of the year and apply it to the previous year. So if you're listening to this in January of 2026, well, you could actually contribute to your

RSP and apply it to the 2025 calendar year. It's the first 60 days of the year. Typically, it'll end on March 1st, but it depends if the 1st of March is on the weekend or not. So sometimes it could be on March 2nd. I didn't check for 2026. So just keep in mind, it's the first 60 days there. To view how much room you have, you can go to your MyCRA account. You'll be able to view your contribution room that you have there.

And like a TFSA, you can hold cash investments inside an RSP. There is factors that determine your contribution room for the purpose of this segment. We won't go over them. But essentially, it's 18% of your salary. And then you can carry over unused room that you have accumulated over the years. And it is capped at a certain amount. I think it's 33,000, so 18% of your salary up to 33,000 right around there. I don't have the exact amount, but that's essentially how it works.

And like a TFSA, you can hold cash and investment inside of the RSP. So think of stocks, bonds, ETFs. You can hold all of that. You just have to make sure, especially for stocks that they're listed on a major exchange. But for the most part, Toronto Stock Exchange, New York Stock Exchange, even the major exchanges around the world, you should be fine. You can hold a bunch of different type of assets within those types of investments like Bitcoin ETFs, gold ETFs would also be eligible. You can use RSPs to fund things like a home buyer plan or a lifelong learning plan.

I won't go into detail what that is, but if it's something that interests you, you can just Google it. You'll be able to find information. You can withdraw the money at any time, but it is added to your taxable income. Keep that in mind. And when you withdraw money, the banks or a financial institution will actually do a withholding tax, but be careful with that. A withholding tax is just a set amount that they withhold from your payment.

It does not mean that it will be sufficient to cover the taxes that you have to pay. So you just have to be careful because there are countless of horror stories out there of people thinking they were fine with a withholding tax. And in the end, they had to pay more taxes. Yeah, this account is very specific to the individual, I guess. it's difficult to say as to whether or not it would be like most beneficial because like pensions can change whether or not it's a good idea to contribute to this. Yeah. Yeah. It's it's very specific. But for like higher income earners, it's actually, you know, it's a very beneficial account because you do get quite a bit of a deferral like when you initially withdraw and then optimally you pull it

out later. Not necessarily in retirement. I mean, you could have a down earning year particularly, especially like, yeah, you can have a down earning year where you can get the money out cheaper than when you withdrew. So it's not necessarily only in retirement, but yeah, it's a pretty complex account. One of the easiest examples is someone who goes on maternity leave, for example, a woman or even a father that would take an extended parental leave. Even with the I, your income is likely to be quite low for the year, especially if you don't have top of benefits, so that would be an example.

But let's move on to the first home savings account here. A relatively new account just came out a couple years ago. Really interesting account. So if you're looking to buy a home in the next five to 10 years. years. Listen to this one because that's probably the account for you. Yeah, it's a combo between the TFSA and the RSP, I guess. And it was kind of created to support those who are who are saving for the first home because obviously it's very difficult right now to get a home in Canada. The lifetime limit is 40,000 and annual limits are 8,000. And room does carry forward. But the

difference here is, so with a TFSA, you get the room no matter what. With an FHSA, you actually have to open the account. So you will not get the room if you don't have an account open. So if you're going to use this account, open it right away. And where it works like an RSP is contributions are tax deductible. So it will reduce your tax, taxable income potentially leading to a refund, obviously depending on a wide variety of circumstances. And obviously, you know, depending on how your income is, the refund can be large. You can hold investments in the FHSA. The strategy you take is really going to depend, I think, on your timeline in terms of buying a home. You know, obviously if you're more short term, you got to really judge whether or not you

want to take on a lot of risk because, you know, if you buy investments and the market goes down, there's potentially you could have less money in here rather than, you know, when you go to buy home rather than what you've contributed. If you don't end up buying a home, you can transfer all FHSA money into your RSP without using RSB room. And pretty much this is the only account in Canada that is tax deductible going in and tax-free coming out if it goes towards a home or if it goes, you know, towards RSPs, obviously those would be taxed when you take them out. But if you withdraw it, say,

just as cash, like maybe you kind of bail out on the idea of buying home. It's taxed like an RSB withdrawal. And this account is much more beneficial than the home buyer plan and the RSB. Again, we won't go over that a lot. But with a home buyer plan, you're, you're effectively borrowing your own money and then you have to pay it back. Whereas with the FHSA, it gives you, you know, tax-free earnings in terms of investments, things like that, and you can pull it out tax-free buy a home. There's no repayment obligation. It's a great account. I wish it was around when I was much younger because I would definitely would have to use this. I mean, the best thing to do if you have enough money and it kind of makes sense for your situation would be to use

the FHSA and the home buyer plan, then you can kind of, you know, get a lot of money towards a down payment. But if you only need one of the two, because the home you're looking to buy will not require much more than, let's say, 50,000 and you think you'll get enough returns with just the contribution room from there, then you should just do the FHSA. Like it is, you know, if you're looking to buy a home and you don't have this account open yet, like pause this podcast and open it and go open it. And then you can resume the podcast. Yeah. But yes, it's a no-brainer. Like anyone buying a home that doesn't have this account is making a mistake. Yeah, there's almost no, I can't think of a single con.

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Use code TCI, and you get $50 to get you started. Winters in Canada can be pretty cold, but they can also be pretty magical. We're thinking about taking a short trip from Ottawa to Quebec City for the winter carnival. My wife and I spent our honeymoon there a few years ago, so it will always have a special meaning for us. And now with my daughter, she'll also get a chance to appreciate how great Quebec City is. She'll be able to practice speaking French, and I can already picture her lighting up when she sees the ice sculptures or tries snow tubing for the first time. After a full day of activities, I can imagine us heading back to our home away from home on Airbnb,

be making a warm dinner, maybe picking up some local pastries for dessert, and just winding down playing some board games with a nice glass of red wine. It got me thinking about hosting our own place. While we'd be away, our home could give another family the chance to enjoy winter loot in Ottawa as it will just be sitting empty while we are away. The nice part is we get to decide when our place is available and it lets us make a little extra to put towards our next trip instead of having our place just sit empty. Your home might be worth more than you think. Find out how much at Airbnb.ca slash host.

Now, let's move on for newer listeners that would have kids. Actually, you don't need to have kids for this one, but most people open a registered education savings plan in RESP would have, would do so for their own children's education. But it could be an open, let's say you have a brother or sister. like a niece or nephew, you could open an account for them as your niece and nephew being the beneficiary. You don't have to be the parent necessarily. I think you can even be a friend, for example, of the family. You could do that as well. You contribute after tax dollars, but the money grows tax free. When it's withdrawn for school, it's taxed at the student's income, which is typically

very low. So in a lot of cases, there won't be any. It's going to be tax free when it's withdrawn. However, it is with you know you contribute with post tax dollars so dollars that have already been tax that means like I said there will be often little to no tax when it's used for I believe their education saving payment or something like that I can't remember the exact term the there is some very interesting government grant the most important one you should know about is the CESG the government matches 20% of your contribution up to a maximum of 2,500 of your contribution for the year. So the government will match up to $500 total for the year. And there's is a lifetime maximum grant of $7,200 per child. So essentially,

if you do $2,500, the government will give you $500 per year. And then that total cannot exceed $7,200 for that one child. But it is free money essentially that the government is giving you. There are other grants that are available, especially for lower income. households. And there are some provinces, I believe Quebec and BC also have some additional incentives for their residents. Again, I will not go into detail, but feel free to research those. There is a maximum of $50,000 lifetime contribution per child for the RESP. And the maximum length of an RISP can be open for is 35 years after which it would have to essentially be either withdrawn or you can, I believe you'll have the option to transfer it.

to an RSP as well. Yeah, it's a good account. Obviously, with me having twins, I've been looking into these a bit. I would say, like, they're a little out of touch on, on, you know, they should be matching more,

I think, because education is ridiculously expensive right now. I mean, $500 is. Yeah. I would argue it should be higher than this, but I mean, it's free money.

You may as well take it and you can set some money aside for, for later on. Yeah, the only thing I forgot to add is if you do not use for the child's education, you will have to reimburse the grants to the government. So that's something to keep in mind.

Now, the next type of accounts here are taxable accounts. You may see them oftentimes as cash or margin accounts. And if you're doing a self-directed investment with an online broker, so Dan, you want to go over those? Yeah, so these are kind of utilized for the most part, I guess maybe in some very rare circumstances when your tax sheltered accounts are maxed out. So you've maxed out your TFS. say in your RSP and you're looking to contribute more to your investments. You often open a

taxable account, cash, margin, things like that. So you are taxed on all investments in these accounts. So the dividends are taxed. The dividends are taxed in the year in which you get them. A lot of people make the mistake that they think if you reinvest the dividends, you're not taxed. You are taxed on them, even if you do reinvest them. Any distributions you get, any interest income you get, capital gains. Obviously, you have to sell it. in order to realize that capital gain, but you are taxed on all your investments. And as you had mentioned, most of the time brokerages will give you access to margin in these accounts. I think there's some brokerages where you can open a cash account that doesn't have

access to margin. But for the most part, when I've held a cash account, a taxable account at a brokerage, you do have a bit of margin. And this is when you will borrow against your current holdings in order to invest more money. Generally, I think it's a bad idea, especially for new, you know, new investors. It's very hard to outpace rates of interest on margin over the long term if you're investing because often you'll pay anywhere from 6 to 8% for a lot of this, depending on how high or low interest rates are. It's expensive debt, but a lot of people use it for short-term trading.

And on the flip side, with a TFSA or an RSP, you can't claim losses. So you do get taxed on capital gains, but in a taxable account, you can also So if you lose money on an investment, you can get a capital loss and offset it against your gains. You can't do this in tax sheltered accounts. And I mean, again, this is pretty much a spillover account except in very rare circumstances. Once they're full, you kind of start this one up. Yeah. And margin, it's just borrowing to invest.

Essentially, that's the easiest way to do it. And it can magnify your gains or magnify your losses. So it is much riskier. So that's why I don't do it personally. some people I know have done in the past if you know what you're doing go for it but you can get hurt pretty badly but now let's look at the final account

here locked in retirement accounts so these are these you cannot open just like that so there's really a set of circumstances that will allow you to open these accounts so these type of accounts will usually be tied to a pension or retirement you had with a previous employer so if you never had a pension plan or retirement plan with a previous employer, you won't be able to open these accounts.

They'll usually be in one of two forms, either a locked-in RSP or a locked-in retirement account. Typically, a locked-in RSP would be if the retirement plan was with a federally regulated employer. For example, the banks, banks are federally regulated airlines. Again, federally regulated if you work for the federal government, same kind of thing. If your employer was provincially regulated, then it would be a locked-in retirement account, Illira, legislated with that specific province. And they'll have some weird sometimes differences when it comes to accessing the fund into retirement. But for the most part, they're very similar in the way they function while the money is there.

If you're starting to invest, you're probably not thinking about withdrawing the money just yet. So we'll keep it more at the, let's just say you're in the accumulation phase of your investment career. career. And they essentially function like an RSP with a couple of key differences. So you cannot contribute any new dollars to it. So if you left your employer, you had 50,000 in that retirement account, it goes into a locked in RSP. Well, you know, it goes there, but you cannot add any new money to it. You cannot withdraw the money whenever you want like a regular RSP. There are some age requirements. And before you withdraw, you'll have to convert the account to a decumulation account or withdrawal type of account, which sets the minimum and maximum you can withdraw

every year in a percentage. So it'll be between 2 and 4%. So you can withdraw any amount between that as an example. Most of the time, based on legislation again, which depending where your employer was, you'll have the option to unlock 50% of the funds that are locked in at age 50. If I remember, there's a 50% on unlocking rule. And so that will allow you. Let's say you have to $100,000, then you could unlock 50% and essentially convert it to a regular RSP. So there is that 50% rule. And just like an RSP, when the money is withdrawn, it adds to your taxable income. And whether it's a, like I said, a locked in RSP or Lira will depend where your employer was located. And you can choose the same kind of

investments that you would choose with TFSA, RSP, RESP, tax, well, taxable accounts will have more different kind of investment that will be eligible for those accounts but you can choose the same kind of investment as a TFSAR RSP for example yeah I did this like with my pension when I was in Fort McMurray like when I left I just turned it into

a lira and I kind of do self-directed now I know there's like rare circumstances where if you if you're like financially hard up you can potentially get access to some of the money yeah there's a like hardship or I think if like there's a very strict rules around that. Yeah, it's very exceptional circumstances. So if that's the case, then definitely you can talk to to the financial institution, explain that they should be able to

guide you into that. But for the most part, these are locked in because they really want you to use these funds in retirement. Yeah, it is very, very difficult to get money out of these. Until you, obviously, until you need it, like in retirement. Yeah, that's it. Now, so let's move on to the second portion of this episode. So our stocks on our radar are presented by our great sponsor EQ Bank. We haven't done that in a little bit. It's just been with Dan with the baby and every or babies with, you know, becoming a father in the last couple months and just a lot of news on the slate as well. But now we're we're getting back to it. So then I'll let you get started. I know you have a couple of names here. So do you want to go over the two names and then I have

a few names myself, but one where I'll do a bit more information and the other ones I'll do a bit more rapid fire. Yeah, so I know you had done an episode on this, but I've kind of been focusing a lot of it on budget 2025 as kind of the stocks on the radar and both these stocks I own already, but I've been adding to a bit more recently just kind of based on the fact that government spending is going to go through the roof. And the first one is WSP Global. So I mean, their core business here is kind of consulting, design, engineering, stuff like that, like fee-based revenue growth from both public and private sector. So they're near 50-50 split between public and private. So, I mean, ultimately, if the government spends more, that's probably going to encourage

private to spend more as well, because a lot of the budget, I believe, is incentives and grants to get private capital into the markets along with public. Budget 2025, heavily focused on infrastructure, public transit, water, like sustainable infrastructure. This is kind of WSP's wheelhouse, and it is becoming, you know, a lot more efficient at winning large contracts. I believe their backlog is close to a year's worth of revenue. And I think they're guiding over the next three years. They're guiding to 40% revenue growth, 50% EBITA growth and 70% free cash flow growth. Obviously, this is this is guidance.

They have to hit this first. But the one of the main things I got asked about with this is why not a company like Atkins Realis? And Atkins Realis is EPC model, so engineer procurement and construction. So it's a, they're similar, but I would say they're entirely different companies. So, I mean, Atkins is exposed to obviously that construction end of things. So there's delays, labor issues, you know, material pricing, things like that. So WSP is pretty much pure consulting design, typically higher margin.

It's very asset light. It's not exposed to any of the, you know, construction hardships. If a project goes sideways, it's kind of like the contractor, not WSP, that eats a lot of those costs and delays. So they're similar companies, but, but they are, you know, a lot different. And it's just personal preference for me to own something like WSP over Atkins. You know, Atkins is probably higher risk, higher return. Earnings are probably lumpier in that regard, whereas WSP is kind of, you know, slow and steady wins the race, I would say.

But yeah, it's, it's one of my favorite companies that I'm definitely owning and adding more to now. Do you want to go over yours or do you want me to go over my second one? Well, you go over your second one, mainly before you do so, that was one of the rapid fire ones that Yeah, I had on my, on my, on my, um, stock on my radar. So I guess I'll just add my two cents here. So what you said, obviously completely agree with it. The backlog is just essentially growing almost every quarter. Sometimes it stays flat, but for the most part, it's just been ascending up. And I was showing a chart for a joint TCI subscribers there. And the last thing here is if you start looking at the valuation, I'm looking at the trailing 12 months, but whatever, right? Like future growth, it's never guaranteed so you can make an argument that trail in 12 months is not as good as looking forward.

But regardless, we'll use this one just as a baseline. And the valuation is amongst the lowest it's been in the last five years at the very least. So the last time it was around this valuation on the price to earnings or price to free cash. So you're looking back at 2022. So not cheap per se. trading around 36 times earnings and 16 times free cash. But for a company that tends to trade at a premium, definitely on the cheaper side of things for comparing against itself.

Yeah, they've had a rough year this year for some reason. I mean, they went through a pretty big run up, but 2025 hasn't been, they're kind of going through a drawdown recently, which is why I've been adding. But I'll go into the second one, which is Toramont. So TIH is the ticker. They trade on a TSX.

So kind of another infrastructure bet. So this is a company that sells rents and maintains cat equipment, caterpillar equipment, very similar to fitting. But I'll get into why they're much different a bit later. The company also has a Simco segment. So they provide refrigeration services to businesses. So you can think of things like, say, cold storage at a grocery store, warehouses, they do ice rinks.

They do curling rinks. They even do things like cooling systems for data centers, which is a bit bullish in that regard. It's not like a huge chunk of the business, but I believe it's around 20%. So if the theory here is if equipment demand rises in Canada, there's two major players who are going to see a lot of this increase, and that is companies like Toramont and Finning.

Ramp up in infrastructure provides plenty of tailwinds. For one, it creates recurring rental income, along with very high margin parts and services income. And typically a lot of the contracts in terms of rentals and even infrastructure are long term in nature. these projects move very slow, so there's a lot of demand for the equipment over longer periods of time. And in terms of why Toramon over Finning, because I've been asked a lot about this, because

Finning is going through the roof recently. And I do want to preface this by saying they're both great companies, but there's kind of, these are very different companies. Finning is kind of Western Canada. So they don't really have much exposure, I mean, even more east of Saskatchewan. So they're more so like mining oil and gas, which it makes complete sense that they've gone through the roof. I mean, look at the mining industry and look at, you know, I mean, oil and gas to a certain degree, whereas Toramont, they're more so the reverse.

So it's more of the Eastern player. And, you know, this, this makes it so the company doesn't benefit as much when, you know, precious metals or oil booms. But we also think of where dollar amount, where most of the infrastructure will be spent on upgrades, it's probably where the bulk of the population lies, which is in Eastern Canada, which is kind of why I'm more bullish on Toramont in this regard. but both great companies, I've owned Toramont for probably a year now, and yeah, continuing to add. Okay, so not too much there. Having cash on hand is essential for any business. Traditional business accounts hit you with high fees while paying little to no interest

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Head to quest trade.com to open and fund an account. Use code TCI, and you get $50 to get you started. Winters in Canada can be pretty cold, but they can also be pretty magical. We're thinking about taking a short trip from Ottawa to Quebec, for the Winter Carnival. My wife and I spent our honeymoon there a few years ago, so it will always have a special meaning for us. And now with my daughter, she'll also get a chance to appreciate how great Quebec City is.

She'll be able to practice speaking French, and I can already picture her lighting up when she sees the ice sculptures or tries snow tubing for the first time. After a full day of activities, I can imagine us heading back to our home away from home on Airbnb, B&B, making a warm dinner, maybe picking up some local pastries for dessert, and just winding down playing some board games with a nice glass of red wine. It got me thinking about hosting our own place.

While we'd be away, our home could give another family the chance to enjoy winter loot in Ottawa, as it will just be sitting empty while we are away. The nice part is, we get to decide when our place is available, and it lets us make a little extra to put towards our next trip instead of having our place just sit empty. Your home might be worth more than you think. Find out how much at Airbnb.ca

slash host. The first one on my radar is one that I've been looking at for about a couple weeks here. It's called precision drilling. I made a mistake here. Pressure. Yeah, press it in my

notes. Precision drilling. So take her p.d.to. on the TSX, market cap of a pretty small company, $1.16 billion, enterprise value, which adds in the debt as well of $1.9 billion. The price earning, trailing 12 months, pretty low at 21, and price of free cash will very low at below 6, 5.6 here. It is a cyclical company. Precision drilling is effectively a technology-enabled contractor

that digs the holes that keeps them going. So they don't own the oil, they own the rigs. And as a quick summary of their main business line, so you have contract drilling, so this is a bulk of their revenue. They provide the high-tech land drilling rigs and the crews to operate them. And from what I've read, they are one of the top players in the industry in North America. They are a big player, of course, in Western Canada, but also in the U.S., the Permian Basin, for example. They also have a smaller international footprint, much smaller in the Middle East, predominantly there. The other parts here is the completion and production.

services. So essentially once the hole is drilled, there's these services finish a job where they keep producing. The segment is less volatile than drilling because wells need maintenance even when oil prices drop. There's service rigs. There's also rental and camps. And the bold case here is that demand for oil and gas keeps increasing in North America specifically because that's where the bulk of their businesses and more rigs are needed for oil and gas production. The Bayer case is that, we enter into recession and that investment in production slows, you definitely also want higher prices because typically higher prices will encourage producers to get more rigs online. So that is something, I would say, you know, probably want prices to be above $70 per barrel

of oil in the U.S. at WTI. So keep that in mind right now it is below that price. But I think for me, there's a bulk case to be made here because of what's going on the energy consumption size side of things because, look, we do not have enough power, especially when we start thinking about AI. We mentioned we've talked about AI quite a bit in the past few months. And what of the things you're starting to see in North America is that you have these data centers, these ghost data centers that are being finished, but can't be turned online because the power grid

can't support it, whether there's enough power or simply there's not the information. infrastructure to get the power to the data center. So clearly, a faster way to fix this versus, let's say, building a nuclear power plant would be to building gas power plant, natural gas power plant. So there is kind of that energy bold case. Of course, you also need the infrastructure to power it. Or you could build a power plant and just build the data center right next to it. So that is also, that's also an option.

But that's kind of the bullish case for the energy side of things, which I think it's really hard to argue right now, how much demand you're seeing for AI and those data centers. So that's why it's really interesting for me this play because it's more like the Pixen shovel, I would say, for the energy space, you're going to be less dependent on the price of oil and gas, although you're still going to be indirectly dependent on it. So it is more of a cyclical play, definitely more volatility, smaller company as well. So there's definitely some risk associated with that. So I'm still on the fence, but it is on my radar. Yeah, it's definitely one that you need. Like, it's not one you can probably just buy and hold. Like you need to, you need to be timing the cycles.

My grandfather loved this company. Oh, wow. Because he owned it back in probably, I want to say, like 2011 and kind of, you know, it was a huge company back in the day up until like I don't want to say huge market cap wise but when oil tanked in 2014 it just absolutely collapsed and he mentioned it almost every single time he'd love this company but yeah it's like it's one you need to kind of time the cycles on I mean if you bought it obviously at the top in 2014 it it was not very good but if you got it at the bottom in 2020 you made a ton of money so yeah you got to play the cycles with these they're difficult but

if you do play them right you can actually end up making quite a bit and you can definitely make a case that were like things are a bit depressed right now too and then you talked about the budget right one thing that was announced was it last week the memorandum of agreement with alberta for pipeline going out west and i think the oil tanker ban to potentially look at that being removed so clearly the federal government is open to the more exploration more using of those natural resources specifically oil and gas. So it could be definitely something very beneficial. So that news that came in last week could be very beneficial to a company like precision drilling. Tech Resources here is under my rapid fire. So tech resources, this one's pretty simple. Again, on the energy demand side of

thing is likely going up and up. And yes, you need more energy, but you need the infrastructure and the grid to be expended to be able to support that transmission of energy. And, And tech resources is one of the most pure play copper plays that you have out there, copper and nickel, I think, if I remember correctly. So it's a really interesting play to keep an eye on. Of course, there is still the talk of the merger with Anglo. What's the company? Do you remember?

I can't remember. But it would make them the largest copter producer in the world. Yeah, Anglo, it's like a European company, I think. Yeah, exactly. Yeah. So there is still that angle there. But I think to me, that's a really, really interesting play. to play copper, where copper is still relatively low,

but it's hard to not see the price of copper increase in the coming years with the build-out. Like, it's really, really hard to not see that increase. So tech resources could benefit from that. Of course, it's a minor. There's always additional risk with that. They have high over-ed costs. But if you're looking for pure play in Canada, I think tech resource is the way to go. And the last one here is Taiwan Semiconductor, one company that I know you own.

And this is my view, the best way to play the Picks and Shovels in the AI space. So you can see the theme a little bit here, build out, picks and shovel, kind of the things I'm looking at right now. Because I find the AI space, there's a whole lot of hype, but there are some, there's other ways to play it than the most prominent names. Obviously, TSMC, Taiwan's my conductor company, Tickr TSM is not a small company. but some people will might think you know what Nvidia chips will win out or AMD whether chips might win out or Google's APU will take a big part of the market share

or maybe they just saying that Apple MacBook Pros will keep firing all cylinders with those M-series chip that they have in those Apple computers. Well, you can actually get exposure to all of that because you know who makes those chips? It's Taiwan Semiconductor. Because those companies I just mentioned design the chips, but the ones that actually

manufactured the chips in their fabs, it's TSM. They produce 90% plus of the world's most advanced chips and have the equipment, but most importantly, the know on how to do it. They're not the only ones that have the equipment. Intel is also, I think also has access, has purchased a few extreme ultraviolet machines from ASML, but you have to keep in mind that Taiwan's in my consideration. Conductor has been investing tens of billions every single year for decades now into the technology. They also have the expertise.

These are very complex machines and they know the designs very well from the different companies they deal with, like an Nvidia, AMD. They're also independent. So there is some extra reassurance that they don't, like, they're not incentivized to steal the designs. because they just produce the chips. So their clients, it's Nvidia, it's MMD, it's Google, whereas an Intel, some companies may be more reluctant because they might fear that Intel would steal those design

and build their own chips off of it because Intel also designs chips. But at the end of the day, I think to me it's a really interesting play. It tends to trade at more reasonable multiple than an Nvidia or some of the other names in this space. But the biggest issue is the one that, most people are aware of when it comes to anything related to Taiwan, and that's the geopolitical risk. And of course, if trade tensions or tensions in general increase between the U.S. and

Taiwan, it could create some issue. Of course, they're trying to diversify away from all of their production or most of it being in Taiwan. But the majority is still there. And even with some of the new fabs opening and starting production, the U.S., it's still not going to be the majority. So it's going to be a small portion that will be produced in the U.S. I think it's probably going to take years before that production is more evenly distributed. So that is the main risk for TSM. But it's on my radar. It's a company I've always liked, but there was always the geopolitical risk that kind of made me not invest in it.

Yeah. I mean, for me for a while too, but then I eventually bit the bullet. But like, there is a lot of people who probably look at this company and see like the cheap earnings multiple. I think it's only trading at 21x expected earnings. So which if you think about it, this is like a $1.2 trillion company that's growing at like a 30, 40% pace. So you would think like 20, 21x earnings is a crazy good deal. But again, it's that it's the geopolitical risk.

Like I don't think it's never going to get. Like I say, if you put this company like in North America, I think it would be worth way more like valuation wise. But it's just not because there is a lot of geopolitical risk. And also, I think the fact they operate in Taiwan makes a margin profile a lot better. Like, I think when they open up a lot of these places in North America, they're probably going to find that they probably operate at lower margins. Obviously, it's just, you know, a more expensive place to operate.

But yeah, it's a pretty interesting company. It's one, as you had mentioned, I think, like pure picks and shovels, I would say down there with something like ASML, which is kind of those are the two that I do own. Yeah, no, exactly. So it's, you know, I think it's a fantastic business. you just like any investments there is going to be some risk that one is definitely very visible in terms of risk but those are the stock on my radar brought something new to the table i know the names you talked about you've mentioned a bit before but some of the stuff we're looking at hopefully people enjoy that i know it's always popular when we talk about the stocks on the radar

and the beginning of the episode hopefully it just gave you a refresher on things you already knew if you've been listening to us for a while. But if not, if it can be useful for someone you know that is looking to invest, definitely encourage you to share the episode on that. If for those are interest in, join tCI.com is our Patreon page where we share our portfolio every month. We share an update on our portfolio and the updated performance and holdings as well. We also have the podcast ad free feed that's available for the subscribers. and I also do my parents' retirement portfolio at the 15th of the month and the updates there.

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Hopefully you enjoyed those. And then, of course, we'll have our bold predictions in the new year. And we're hoping that Brayden will be able to, we'll be able to fit some time and make some time work. So we can do them like we did last year, Dan Braden and myself. So thanks again for listening and we will be back next Thursday for a news and earnings episode. The Canadian Investor podcast should not be construed as investment or financial

advice. The host and guest featured may own securities or assets discussed on this podcast. Always do your own due diligence or consult with a financial professional before making any financial or investment decisions.