YOUR PRACTICE-Canadian investors look south for growth

Mon Jul 29, 2013 9:56am EDT
 
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* Wealth managers increasing U.S. exposure as rebound beckons

* Investors still skittish, advisors fear clients will miss the boat

* Canadian growth expected to lag U.S. in next two years

By Andrea Hopkins

TORONTO, July 29 (Reuters) - Dean Owen has been trying to talk his Canadian clients into shifting to U.S. equities for months, with only limited success. With slow growth expected at home, he says it is more important now as the U.S. economy gets stronger.

"U.S. consumers are getting out of debt and making sure they have a comfort zone before they start buying, but they will start buying," said Owen, a personal financial planner at Cherry Financial Services in Saskatoon, Saskatchewan.

"But the fears of clients are always going to be 'What happens if they go into another recession?'"

Once bitten, twice shy, Canadian investors have taken to the sidelines or are making cautious bets in Canada's shallow but steady markets in the wake of the 2008-2009 global financial crisis and U.S. housing crash that decimated portfolios.

While the home-country bias might have protected some investors from the worst of the downturn, wealth managers worry that Canadians will miss out on a rebound in the United States, where growth is expected to outstrip Canada's for several years.   Continued...