The Canadian Investor - Palantir Keeps Rolling And the Case for Global Stocks

Episode Date: February 9, 2026

In this mixed earnings and macro episode, Simon and Dan break down Palantir’s explosive growth (and wild stock reaction), Microsoft’s cloud slowdown fears amid massive AI capex, and Starbucks’ underwhelming turnaround outlook. They also dig into what today’s volatility says about tech valuations, why hyperscalers are under pressure to prove returns on AI spending, and whether investors should start looking beyond U.S. equities altogether. Simon wraps up with a framework for international diversification, including emerging markets and ex-U.S. ETFs, and shares how he’s thinking about portfolio positioning going forward. Tickers of stocks discussed: PLTR, MSFT, SBUX, ARCC, ZEM.TO, VEE, IXUS, VEU, XAW.TO Subscribe to our Our New Youtube Channel! 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.

Smart investing doesn't have to be complicated or time-consuming. With BMO all-in-one ETFs, you get a complete diversified portfolio wrapped up in a single ticker. It's easy. Whether you're conservative investor or more aggressive, BMO has an all-in-one solution for you. And now, it's even more cost-effective. BMO has cut management fees to just 0.15% on select asset allocation ETFs, helping you keep more of what you earn. Simplify your investing today at bemoetifs.com.

Investing is simple, but don't confuse that with thinking it's easy. A stock is not just a ticker. At the end of the day, you have to remember that it's a business. Just my reminder to people who own cyclicals, don't be surprised when there's a cycle. If there's uncertainty in the markets, there's going to be some great opportunities for investors. This has to be one of the biggest quarters I've seen from this company in quite some time.

Welcome to the Canadian Investor Podcast. My name is Simon Berger. I am back with Dan Kent. We are back for a mixed episode here. We're doing some earnings. And at the end, I'll be finishing with basically some areas of the market that I'm looking at right now. So I'll keep people guessing. So make sure you stick to the end.

I will give some tickers as well to do your own research into, so make sure you stick to the end. So let's start off here. Continue with some earnings just because there's been so much news and earnings going on. Palantir, definitely one of the darling of the markets, at least right now. So do you want to go over what happened on the earnings front here? Yeah, so, I mean, it's pretty absurd growth from Palantir yet again. However, you know, the company is so expensive that the 70% plus year over year revenue growth, it moved the needle, but like not as much as you would think. I think the stock was up around 6%.

I don't know what it's doing today, but not only did the company grow revenue by 70%, but it kind of just crushed its guidance and still, again, only reacted by around 7%. U.S. commercial revenue increased by 137% and U.S. government revenue. Down 13% today. Oh, God. What a... It's wild. Sorry, it's just kind of crazy the action that's going on, but yeah. It is crazy.

Because, like, I think right off the bat, the company spiked, like, after they reported and then it dipped. Yeah. And now, yeah, it's down 13%. But government revenue increased by 66%. And the company booked over $4.3 billion in contracts this quarter alone. And the company mentioned that, you know, a lot of companies are selling relatively basic AI models. Like Palantir's focus is more on making sure that, you know, a company that's been around for, I mean, a century even can utilize AI effectively.

And one of the, like, this is a crazy stat here. So they mentioned this on the call. The company has a piece of software called ShipOS. So they signed a contract with the U.S. Navy because the U.S. Navy was tired of production direct. eggs over submarines. So you're talking like planning meetings, bottlenecks, scheduling delays, whatever it may be. And apparently one of the main builders of U.S. submarines reported that Palantir software took this timeline down from 160 hours to 10 minutes.

Oh wow. Okay. Yeah. Like all of the, and this is actually reported by like the company. This isn't like a Palantir stat. It's like reported by the company. effectively they can take all these meetings down all this planning all this scheduling down that they had to organize meetings for for whatever amount of time and they can do it in 10 minutes with

this piece of software and last week we went over the yeah it was last week we went over the rule of 40 for software companies yeah so this takes a revenue growth with its profit margin and you want to see something over 40 Palantir right now is at 127 so that's bullish for sure using what EBITA or free capital? Yeah. Yeah. Would be EBTA. EBTA margin plus, yeah, the revenue growth.

So you're talking like obviously 70% revenue growth plus the EBITA margins. 127 is is unheard of. The company's guidance for 2026 is 61% growth in revenue with US commercial revenue increasing by 115%. And one interesting thing the CEO went off kind of on on Canada and European nations. It was along the lines of how they're kind of so. how they're so vested in developing things internally that they're kind of falling behind when it comes to AI.

Instead, they should be buying the best product available, which at this point in time would be American made. Which would be their product. That's why it was really. Exactly. Exactly. That is exactly why it was raised. And I mean, I think Palantir is pretty famous for being one of the most misunderstood

companies like in the world. Like, I'm pretty sure, wasn't it like five years ago, six, seven years? like this company, like everything they did was confidential because it was all like government works. So you really didn't know what, what they did. I think it might be. Yeah. I'm not sure.

It's not a company I follow that closely, but I think it rings a bell. I mean, it's, it's fallen into my too complex bucket for pretty much forever. And I mean, I've owned plenty of complex companies like insurance companies are very complex. Consolation is another complex company. But I mean, when you, when you see the complexity of the company plus the value, I just don't know, like I can't even sit here today and say, okay, what would happen? What can go wrong and what would happen if it does? So I've never really owned it because I mean, once you talk about a company trading at, you know,

120x revenue, it gets to be a bit complicated. But like, there's no doubt they're growing at, at an absurd pace, especially they got to be like the fastest, because they're $350 billion market cap or something. They got to be the fastest growing company at that size. by a wide margin, I would say. Yeah. Yeah, I mean, they're growing fast, but their revenues are still quite small. Like, they need to continue that growth for quite some time to grow into their valuation.

I think that's what people tend to forget who love this company as there's not much margin for error. And I guess I don't know what happened today that's causing it to be down 12 percent, but I think that's just an example. Yeah. I mean, they have another quick example how crazy this market is. They had Uber reported today. We're not going to talk about it. But Uber reported and they changed the number and they're adjusted net income.

So it was different than people expected. It fell 10%. Then people realized that it was a mistake. It spiked. It was up 3%. And then they had the conference call and I think it's down like 6% right now. Yeah. Yeah, exactly.

That's all in one morning. It's, um, I guess so far 2026 volatility is the name of the game, right? It's been, uh, volatile on a lot of different fronts. So now let's move on here. Another company that's been volatile, at least on the way down, Microsoft. So it's up a little bit today, but definitely has been down quite a bit over, I think, just the beginning of the year, right? Like it's down close to, what, close to 15% year today.

And over the last six months, it's down 22%. So definitely some headwinds for Microsoft here. Revenues were up 17%. But I say head wins, but the results were actually pretty. good. They spent 37.5 billion on CAPEX during the quarter. Two-thirds of that allocated to short-liff assets like GPUs and CPUs, which are being amortized over six years. I remember reading here, earnings per share was up 24%. They mentioned that their Windows operating system segment will likely be impacted by higher memory prices. So the way they said this, essentially it's pushed up some PC demand.

Ford, where companies and individuals wanting to upgrade or going through the upgrade cycle, we're seeing prices of memory go up so they were buying it before it increased more. But now I think they are seeing some people waiting to upgrade because of that same reason, because memory prices are so high. But they said it was offset partially by them discontinuing their support for Windows 10, which ended in October 2025. that includes security support. So forcing users to get newer versions and buy newer versions or licenses of Windows.

Yeah, it's, I mean, the results are not that bad from Microsoft. So it has to be, is it like the 365 situation with AI and like disruption in that regard? I'm not, I'm not exactly sure. I actually brought this up and people kind of laughed at me because of like the complexity of 365 and how like deeply ingrained that is into a lot. lot of systems, but I just don't really understand why it's fallen as much as it has. Yeah, I mean, I think it's, I'm not sure either the big, the bid line was that cloud revenue was up only 26%. And assure, which is a subset of cloud revenue was up 39%.

I guess expectations were slightly higher that it would come in a bit more than that. They came in strong, but the market would have liked more. And on top of that, they are guiding for Azure to grow through. 37 in the upcoming quarter. So that would be some deceleration. So I think the market's not liking that. Of course, it's still super strong growth, but I guess it is decelerating a little bit.

And for total revenues, they are guiding for 15 to 17% growth in the next quarter. And in terms of CAPEX, maybe that's why also the market was not a fan, is they were not super clear for CAPEX. They just said they expected, it to be lower in the upcoming quarter. And I think the markets are becoming more and more,

just paying more attention on the amount of CAPEX that is spent here by these large RIPA scalers. I think they definitely want good return on investments. And you see here Microsoft is spending a whole lot. They spend the last quarter quite a bit on CAPEX, right? I think I had it at 37. Not quite sure why it's showing 29 here for fiscal. not AI, but anyways, they spend a lot on CAPEX. If you're looking here at just the trend,

it's just, yeah, it's been increasing quite a bit over the last, what, couple years. Yeah, and I think just the market is starting to want to demand that there is some better returns on those investments. That would be my, my base case here, or is getting nervous that they just might not see proper returns on that spend. Yeah, you definitely don't want to see ramping up Capex, but slowing growth. I mean, I did see, yeah, there was one, sorry, there was one, a tweet on X that said, you know, Microsoft falls 12% because Azure grew 39% instead of 39.4%. And I mean, I, like, that's like that is how finicky the markets are right now in regards to this, especially with the hundreds of billions of dollars that are just being dumped into AI infrastructure. Yeah, exactly.

And I think, uh, remaining performance obligations. So these contracts, I think they are, they're still growing nicely. So I'm not quite sure. It skyrocketed. Yeah. Yeah, it skyrocketed. So again, things can happen. You still have to recognize that revenue eventually.

So yeah, there's some execution risk tied to that like we saw with Oracle. But I think for me, it's definitely one that I have on my radar because if you're looking at the valuation for Microsoft, it's trailing. If you're looking at a Ford valuation, a P.E of around 20. 29 price to earning growth of 1.2. So you just look at the P compared to the growth in terms of earnings. So it's really, it's looking pretty attractive. I wouldn't say pretty attractive, but definitely more attractive considering the extent

of the business. If you think about Microsoft, right, it's more about, it's more than just the cloud. It's more than just enterprise, more than just Windows. You have gaming. You have all these different things. So a lot of things that should end up doing fairly well in the future, especially if you can get it at a decent valuation. Yeah, like not necessarily cheap, but cheaper than it's been cheaper in the past. Yeah.

That's it. Yeah. So we'll have to see. Having cash on hand is essential for any business. Traditional business accounts hit you with high fees while paying little to no interest on the cash you need for day-to-day operations. That was our experience too, until we switched to the new EQ Bank business account. Now, every dollar earns high interest with no monthly fees and no minimum balance. You also get free everyday transactions like EFTs, bill payments, mobile check deposits,

and 50 outgoing and 100 incoming free interrackee transfers. And to sign up, quick and fully online, no branch visits because, let's be honest, no business owner has time for that. We use it for our own business and it's the first account that actually helps our money work harder while keeping operations simple. Check it out today at EQBank.ca slash business. My wife and I are currently planning a big summer trip to the Maritimes and our daughter will be visiting Halifax for the very first time. We're looking for a place on Airbnb right near the water so she can wake up and see the ocean every morning. We can already picture ourselves exploring the waterfront and coming back to a cozy house to cook a family dinner

or for a quick change of clothes and head to a local family-friendly seafood restaurant. Finding the perfect home base is making the whole trip feel real. It also got us thinking about our own place while we're away. If another family's home can be the backdrop for our first maritime adventure, maybe ours could be that for someone else. hosting our home on Airbnb would let travelers make their own memories in our beautiful neighborhood while giving us extra money to put towards all those lobster rolls in Alifax. And the nice thing is the flexibility.

We can decide to host our home only when it works for our schedule. Your home might be worth more than you think. Find out how much at Airbnb.ca. Calling all DIY, do-it-yourself investors, Awesome is an essential app for you. It has been blowing up with now more than 50,000 Canadians plus and growing who are using the app. Every time I go on there, I am shocked. The engagement is amazing. This is a really vibrant community that they're building. And people share their portfolios, their trades, their investment ideas in real time. And it's all built on the concept

of transparency because brokerage accounts are linked. And then once you link your brokerage account, You can get in-depth portfolio insights, track your dividends, and there's other stuff like learning duolingo style education lessons that are completely free. You can search up Blossom Social in the App Store and join the community today. I'm on there. I encourage you go on there and follow me, search me up, some of the YouTubers and influencers and podcasters that you might know, I bet you they're already on there. People are just on there talking, sharing their investment ideas, and using the analytics tools. So go ahead. Blossom, social in the app store and I'll see you there.

Let's move on here. Something that I guess there's tech in every business, but not necessarily a pure play tech business, Starbucks. Yeah. So I actually sold Starbucks earlier this year. I kind of got frustrated that. Oh, I forgot you sold it. Yeah.

Yeah. So the turnaround wasn't turning around. So when was it? It probably was 18 months ago now that they hired the old Cholos. Yeah. Yeah. So Starbucks was obviously struggling, like mightily. But so they hired him.

And I kind of thought, you know, I'll give it a year, like see what happens. And really nothing has happened. The results themselves, like, were pretty good for this quarter. It seems like they're trending in the right direction at least. And the stock ended up popping in early morning trading. I think it was up 10% at what one point, but it gave it all back. So actually it gave it all back and then some. I think it finished one or two percent in the red.

And I think it was based on the conference call, which I'll get in a bit. But on the quarter, comparable sales increased 4%. Comparable transactions by 3%. And this seems pretty low. And it kind of is. And I'll get to that in a bit. But I mean, these numbers are outstanding relative to what has happened over the last while.

So at its peak, like peak terribleness, I guess you could say. Starbucks was reporting like 8% declines in both of these. It was pretty ugly. That would have been like 2022, 2023. And the thing that kind of scared me and actually forced me to sell was the capital being laid out kind of in an attempt to turn around this business. And I mean, sure, it can work out wonderfully, but it can also kind of come back to bite you significantly. So the company is rolling out on average $150,000 in improvements to all 20,000 of its North American stores. So you're talking about $3 billion plus.

And these are things like comfy chairs, ceramic, mugs, better interiors, things like that. So like, the one thing you kind of have to ask yourself is, do people care or do they just want their coffee? Like, I don't know. I do not care what the inside of a Starbucks looks like. I just want my coffee and go. So it's risky from that front. And the company is actually shifting around 8,000 of its stores in China to a joint venture with what you, I think it's called. So this is an asset manager in Hong Kong. So the company is now going to operate them as licensed stores. Licenses, is effectively franchise, but I think Starbucks maintains like much tighter restrictions, like in terms of, you know, protocol, things like that.

So what this will do is eventually, like obviously it'll kind of crater revenue because they're only getting a portion of royalties on a license store now. But it also launches operating margins. Pretty sure McDonald's did this a while ago. It ended up working out quite beneficial. But I think, I mean, ultimately what ended up sending the stock downwards was the mention of guidance. during their investor day. So they report aftermarket and then, you know, the stock went up 10%. And then the next day was their investor day.

And it kind of cratered after that. And I think it was they issued their 2028 milestone guidance in which they expect revenue growth of 5%. Comparable sales growth of 3% operating margins of 13 to 15%. And earnings of $3.35 to $4. So, I mean, this pretty much confirms that Starbucks is. is not going back to its old ways. I mean, this is a company that used to have

mid to high single digit, same store sales growth, 16% operating margins, double digit revenue growth. And the fact that this was their 2028 guidance kind of gives me some confidence in my decision to sell. The earnings, first off, is way too wide. You know, on the bottom end, you're still trading at 30x their 2028 earnings and top end 20x. I just don't really see the company

as all that attractive from a valuation standpoint, with this guidance, like it just kind of seems like the turnaround is just going to, you know, get a growing low single digit pace. I think it's just a bit too pricey at that point. It's almost like a more of an efficiency play now, right? Yeah, I think so. I think so. So while you were talking, I was pulling this up on fiscal.

So the US Canada company operated stores. So you can see they've actually closed down net some stores. Oh yeah. It doesn't have the full data just yet loaded, but I would assume the trend kind of continued for U.S. stores. And then for North America license operated, it's actually also trended down a little bit. So both company for Canada, U.S. and then North America license operated, they're both down, trending down. So it's interesting. I mean, I wanted to look it up because in Ottawa there's a bunch that close.

Yeah. So I was curious to see. Yeah, exactly, to see how. Like how I was looking for a company wide. Yeah, I think like in terms of, you know, the growth phase when, I mean, what, at least in Calgary, you couldn't travel more than. Yeah. Very, very little before you seen another Starbucks. Like, I don't think that flies anymore because they can't even keep one store busy, let alone like three and in a few city blocks.

So yeah, it's, it's kind of like they're turning things around. There's no doubt. Like, it's better than the, the ugliness. it was a while ago, but it's still like, I mean, that guidance, it's, it's not good. No, and it still gets into the crux of it, right? You're seeing more and more people trying, having trouble making ends meet. You're seeing the cost of food inflation or cost of food increasing. All of these things lead me to believe that, you know, at the end of the day, people may still go to Starbucks, but they'll make it more, less of a routine and more of a treat.

That could be one thing. or they'll go for a cheaper alternative. If it's part of the routine, maybe they'll swap for the, you know, Tim Orrin's, even if they don't like the taste as much. They're looking for the caffeine boost. So they'll go for just more cost effective option. I think it's just a difficult environment for a more of a luxury almost item as a higher priced item. And it's not cheap. We go once in a while, my wife and I, and every time I get shocked by the bill.

Oh, yeah. I had my wife got a gift card, $50 gift card for Christmas. So we had like four people over. Like, oh, let's go get, well, let's go get Starbucks. Like, we don't mind. We have a gift card. And I like order everything for four people. It's like $36.

And then I get to the till and I didn't bring that gift card. Oh, man. Hey, you got credit card points. So. Yeah. It's not bad bad. Crazy expensive. I don't know who frequents it a lot.

Like for us, it's like a once every month. The upper shape of the king. I think so. Yeah. That's who. So let's move on here. So we kind of finish that news and earnings part. So I have a segment I've been working on.

And really the title of it is should investors start looking outside of the U.S. for investments. And I'm going to zero in more on stock investments here, of course, equities. So I've been reading more about fund managers and micro, really, you know, smart macro thinker, talking more and more about investing outside the U.S. it's really not talked a whole lot in major financial news media all that much. Obviously, if you look at CNBC or any of the major one, BNN, they tend to just stick to Canada and the U.S. But first, I mean, U.S. markets are still trading at extremely high valuation.

I know we've talked about SaaS stocks being hit and tech has been hit as well a little bit since the start of the year. But in the aggregate, if you start looking at the Schiller-P ratio, total market cap to GDP, whatever valuation, metric you want to look at, it's still very high. Like the U.S. market is still not cheap. And there's a lot of foreign money that's actually invested in the U.S. I won't go behind all the mechanics behind that for U.S. equities. But it's kind of a result, right, of the U.S. being in trade deficit where they buy goods, they give U.S. dollars, and then you're in another country.

And what do you do with those U.S. dollars? Well, you can invest them in U.S. equities. That's one of the things you can do. US assets. And the most common numbers cited is around 30% of U.S. equities are owned by foreign investors. It's hard to know the exact figure, but let's just kind of use that 30% ballpark here. And why is that important? Because let's be honest, I've talked to, I think I talked about this a little bit recent episode, but what Trump is doing on the geopolitical front, let's be honest, it's pissed off a lot of countries, even traditional allies. And I think this is what the U.S. and the Trump administration

is failing to see. They have the big stick. Obviously, they're using it right now, but they're thinking U.S. first. But at a certain point, you can exert pressure on other countries, but at some point countries will start fighting back. And they'll find ways to fight back.

Sure it might take some time. It might not be a huge impact, but if you have that happening in multiple countries, it can really start making an impact. And that approach that the U.S. is taking right now, it's more of a protectionist approach, right? Less free trade. We're thinking about the U.S. first and all that stuff. We're seeing that with tariffs. And the U.S. is not trying of using its economic power to put pressure on other countries.

We've seen it time and time again. And I think that really has a big risk of starting to backfire in the medium to long term. Maybe not right now, but a way that countries can start pushing back at the U.S. is simply start selling U.S. assets. You can see a lot of countries have massive sovereign wealth funds or large pension funds. We see it in Canada. They have a whole lot of U.S. equities, but you can think about Norway, the wealth fund over there. There's, I think Saudi Arabia has a major one. Singapore.

There's like massive wealth funds across the world that do own a lot of U.S. equities and U.S. treasuries. And maybe not all ones, but maybe they're. start reducing their exposure to U.S. gradually because of course if you just do it all at once, you end up not getting the proper value. So when you're such a big seller, you want to do it more gradually. But you can also see that if governments, and I mentioned that on the last episode or two, you can start doing what South Korea did and start giving tax exemption for Koreans who sell foreign equities and take the proceeds and reinvest them in Korea. And foreign equities is not just US, but that's how you should be selling it to Trump. Let's be honest. You want to make sure that

Trump doesn't think you're targeting the US because then he's going to increase the tariffs on you like he always does, but you sell it at that. The conservative had a similar promise here in Canada, and Carney, I wouldn't be surprised if he puts in place something like that to encourage domestic investment in Canada where you start getting massive tag breaks if you sell your foreign equities or U.S. equities, probably the majority of it, and then start investing in your country. And it has like kind of a double whammy effect. First, you give the middle finger to the U.S. and then you actually encourage investing in your own country. If the U.S. is going to be protectionist, you know, you might as well do the same thing. So I really would not be surprised if you

start seeing more countries doing what South Korea is actually doing right now. Yeah, it's hard to force people to sell US equities if it's, you know, the, obviously it's been the best performing market, you know, for, for quite some time. But if you give them some sort of incentive to, like we had talked about on the previous episode, like you can take lower returns elsewhere if your government is willing to waive the taxes on the gains you've realized on the US equities. Like in some cases, you, depending on your overall tax situation, you could take much lower. returns elsewhere. If you're, you know, if you've got a four or five, six hundred percent gain on some U.S. equity you've held for 15 years and the government says you can pull that money

out tax free if you invested in Canadian equities, like it starts to become very attractive, even if you think, you know, okay, the Canadian market might return less than the U.S. Because there's a, there's a currency perspective there too. Like, you're probably getting out of the U.S. dollar and into the Canadian dollar, so you don't have to worry about swings and that regard. So yeah, it's, it's definitely an interesting concept. Yeah, exactly. And some people might push back. They might say the U.S. economy is performing way better than other economies, and that's a fair point. But the problem, too, with that is a strong economy doesn't not necessarily mean strong stock returns. Like, the two are not necessarily correlated. And you can

also make a case. There's a lot of smart Ameri-Chinker and economists that say, look, the U.S., and we've talked about it, is in a K-shaped economy right now. And there's massive, investments in AI that are really driving GDP probably more than it probably should be driving it. And then you can think of the second order effects that if you start seeing foreign buyers pulling out more and more money in the U.S., well, that could have an impact on the stock market going lower because there's more selling pressure. And then the wealthier, the top part of the K that is likely relying on those stock market gains to spend more, then they're stuck spending less.

you start putting a lot of pressure on the U.S. economy here. But this is just to kind of give the context here behind what I'll be talking about here. And for all those reasons, I think markets outside the U.S., I think you can make a case that they'll perform better than the U.S. market in the next several years. Maybe not, but I think there's a good case to be made. And yes, Canada is one of those markets. I would caution people to be too home biased, though. I think most listeners, I am guilty of that myself at times. definitely own more than I should in terms of Canadian equities. That home country bias is definitely

present. So I would just caution to that to not think that that means just going all in in Canada. There are other countries to invest in. But I think it's a compelling reason to start looking at getting exposure outside the U.S. And there's different ways to do that. Some of the ways that I like personally, well, I'll look at some of the ways that I like. But the three main ways, of course, is individual companies that operate mainly outside the U.S. ETFs that provide exposure to specific countries. So index ETS for specific, whether it's India, China, Brazil, whatever, you pick it, whatever country you want to gain exposure, or ETFs that provide exposure to geographies

that exclude the U.S. So all countries, XUS, you'll also see them kind of marketed as international ETFs, where they're indexed indices that are international, international meaning like essentially excluding U.S. Having cash on hand is essential for any business. Traditional business accounts hit you with high fees while paying little to no interest on the cash you need for day-to-day operations. That was our experience too,

until we switched to the new EQBank business account. Now, every dollar earns high interest with no monthly fees and no minimum balance. You also get free everyday transactions like EFTs, bill payments, mobile check deposits, and 50 outgoing and 100 incoming free interackey transfers. And to sign up quick and fully online, no branch visits because, let's be honest, no business owner has time for that. We use it for our own business and it's the first account that actually helps our money work harder while keeping operations simple. Check it out today at

EQBank.ca slash business. My wife and I are currently planning a big summer trip to the Maritimes and our daughter will be visiting Halifax for the very first time. We're looking for a place on Airbnb right near the water so she can wake up and see the ocean every morning. We can already picture ourselves exploring the waterfront and coming back to a cozy house to cook a family dinner or for a quick change of clothes and head to a local family-friendly seafood restaurant. Finding the perfect home base is making the whole trip feel real. It also got us thinking about our own place while we're away.

If another family's home can be the backdrop for our first maritime adventure, maybe ours could be that for someone else. Hosting our home on Airbnb would let travelers make their own memories in our beautiful neighborhood, while giving us extra money to put towards all those lobster rolls in Alifax. And the nice thing is the flexibility. We can decide to host our home only when it works for our schedule. Your home might be worth more than you think. Find out how much at Airbnb.ca slash host.

Calling all DIY, do-it-yourself investors, Blossom is an essential app for you. It has been blowing up with now more than 50,000 Canadians plus and growing who are using the app. Every time I go on there, I am shocked. The engagement is amazing. This is a really vibrant community that they're building. And people share their portfolios, their trades, their investment ideas in real time. And it's all built on the concept of transparency because brokerage accounts are linked. And then once you link your brokerage account, you can get in-depth portfolio insights, track your dividends.

And there's other stuff like learning duolingo style education lessons that are completely free. You can search up Blossom Social in the App Store and join the community today. I'm on there. I encourage you go on there and follow me, search me up, some of the YouTubers and influencers and podcasters that you might know. I bet you they're already on there. People are just on there talking, sharing their investment ideas, and using the analytics tools.

So go ahead, Blossom Social in the App Store, and I'll see you there. So there's a few options. I'll go over here. So first of all, as everyone knows, BMO, ETF is a sponsor. sponsor of the podcast. But honestly, they have one of the better CAD options if you're looking for an emerging market's index ETF, ticker ZEM. It's really interesting option because it is in Canadian dollar. The downside with this one and many emerging market ETF is that Taiwan plus China is 45% of the ETF. So they are a big part. And of course, with everything that's happening,

the tension between Taiwan and China, it is a really. risk to keep in mind and TSM alone is 10%. So it is quite concentrated, but you compare this one to EEM from Black Rock and it has similar holdings and fees of 702.0.072%. So much higher than the 0.27 that BMO offers. The other option that I think is a consideration compared to the ZM from BMO is VEE from Vanguard. So the Futsi emerging markets all. caps index ETF. It's actually slightly lower management fees at 0.25%. But the reason why I actually like it a bit less is China and Taiwan is combined 54% instead of 45. So you actually double down a little more. So I actually like the BMO ZDM here as a better option. Obviously, they are

a sponsor of the podcast. So make sure you do your due diligence when you look at these and take your own decision. But I think it's a very solid option. here for emerging markets. Yeah, and I think with a lot of emerging market ETFs, just make sure, like, you look at the allocations. Exactly. Because a lot of them will be, like, some of them might be, although this is usually in the name, but some of them could be X China,

for example, and the allocations will be vastly different. Like, they're not all the same. Just kind of dig into where you're actually getting the exposure, and if you're comfortable with that, because. Yeah, but you could have done worse than investing in China in the last year or so. Definitely. Yeah. It is something to keep in mind.

I've been bearish on China, probably maybe too much over the last couple of years, to be honest. And clearly it's had some pretty good returns. And the other option here is all the world excluding U.S., like I mentioned before talking about the emerging markets here. Obviously emerging markets is more specific to emerging markets. The top holdings will typically be Japan around 13 to 15%. So definitely different. Canada will be a decent weighting here, typically around 80%.

usually in the top five in terms of geographies. Emerging markets exposure will be around 25%. In terms of auction, there's I-XUS from BlackRock and VEU from Vanguard. Those are two solid options. Both have no direct exposure to U.S. stocks, All-World X-U.S. Personally, I'd probably do kind of a 50-50 approach because I think it's a bit too much kind of developed market for the all-world air. That's my personal thing.

It may not be for you. So make sure you do your research there and what fits for your tolerance and the exposure you're looking for. But personally, my approach would be picking something like, yeah, the IXUS or VEU, putting about 50% of the allocation I want to put outside the US. And then the other 50% I'd pick one of the emerging markets, probably the BMOZEM here emerging markets and do a 50-50 where it would give me more than. the 25% roughly exposure that you get from emerging markets in the all world XUS,

but it would also kind of lower it than just being just all in on emerging markets. Yeah, I think there's kind of like a fine line there. Like the emerging markets isn't like isn't India one of the fastest growing economies in the world? I think so. I mean, I don't think you want zero exposure to do it, but you also don't want to go outside there. I mean, I'm guilty of I am one of those people who has no. exposure. I'm just pretty much 100% North American. If I were to buy international, like I would not mess around with individual equities. I'd just buy a fund. Yeah. It's,

it's the easiest way. First off, like currency issues and stuff like this, a nightmare when you can just buy one of these funds in Canadian or US dollars. But yeah, yeah, I think there's there's logic to it now. Like I remember back in probably would have been 2021 or 2022, like the amount of people who were dumping their Canadian. Canadian equities because, you know, the U.S. had better returns. I mean, obviously gold is a big reasoning for that, but I like the DSX is, is, it's, I think it's outperform the S&P over the last three years. It'd be pretty close, but.

Yeah. Yeah, I mean, they're close. I haven't looked at it, but I think it's definitely worth considering. I'm not saying dump all your U.S. stocks. No, no. Don't hear what I'm not saying here. I'm just saying that I think international equities, there's a strong case to be made that they might even outperform the U.S.

over the next couple years, if not a bit more here. I could be completely wrong, but I'm definitely considering getting some more exposure. I already have some through XAW here, the All World X Canada, which includes some U.S. exposure. So I would actually like kind of balance it, probably do one-third daub, one-third the BMO fund, and one-third, either the Black Rock vanguard of the emerging markets do one-third, one-third. and then I have some pretty good kind of broad base exposure in term of my index funds and international exposure outside of Canada. Yeah, and that's exactly what I used to do is I would own Canadian equities and then I owned XAW.

But back when the when the Canadian dollar went really high, I sold XAW and converted it to U.S. dollars. And ever since then, I've never really grabbed exposure. But there is periods of time where international equities have outperformed U.S. equities. And like there is periods in time when U.S. equities are this expensive, that is one of the time periods. I mean, I guess the easiest way to not try to time this is just kind of own it at all times. It should just be kind of a proper diversification and a portfolio for sure. No, exactly. But I know that's a segment I did.

I know we don't talk about international stocks that often. But something I definitely have on my radar, I think you can make some solid arguments for investing in international. national equities, obviously outside the U.S. and Canada here, just because home country bias and all that stuff. So hopefully, you know, you enjoyed this episode. If you did, please make sure you give us a five-star review if you haven't done so anymore on already on the whichever platform you're listening to us on. We will be looking to do a YouTube live in the next week or two. Like we've been mentioning, make sure you subscribe to our YouTube channel. It's in the show notes below. and for those interested, we also have joint TCI.

It's available for subscription for $15 a month. I think that's about it for the wrapping up here. A lot of content that we did over the last few episodes. Hopefully you enjoyed it and that extra bonus episode that we had last week. And we will be back Thursday for news and earnings and potentially just stay on the lookout, subscribe to our YouTube channel, and you'll see when we're planning the live YouTube podcast. Thank you. 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.