Own the Canadian banks, don’t let them own you. Plus, the Sunday Reads.

It was another stellar quarterly earnings season for the Canadian banks. They mostly beat estimates sending stock prices considerably higher for the week. You just can’t keep the big bad bank oligopolies down. As the Canadian economy hobbles, the banks seem to find a way to generate more revenue and more profits. Keep in mind most of the banks have considerable operations in the U.S., the last bastion of unleashed capitalism and entrepreneurialism in the developed world. Ironically, the U.S. is in the process of wiping Canada off of the economic map. Well, at least that’s their plan. It’s hit and miss on the economic destruction front as the U.S. seems to need a lot of what Canada produces, namely oil and gas and other materials. We’re wrapping up the Canadian banks’ earnings season on the Sunday Reads.

Off the top, remember you want to own the big Canadian banks, you don’t necessarily want to bank with them. And you certainly (almost exclusively) don’t want to invest in their very poor performing Canadian high-fee mutual funds.

Beat the Banks

Here’s my review of Larry Bates’ Beat The Bank: The Canadian Guide to Simply Successful Investing. It’s a must-read Canadian investment book and wonderful message …

Don’t give away half of your investments – Beat The Bank.

You want to make riches off of the Canadian banks while you keep them out of your pockets. Here’s one of my favourite images that I’ve used on Cut The Crap Investing.

Larry shows how high fees and inflation and taxes are wealth destroyers. We want to manage them as best as possible. Regular investments into well-diversified low-fee ETFs (or stock portfolios) leads to incredible wealth creation.

From bank beaters to wealthy barbers

I recently reviewed the latest Wealthy Barber book from David Chilton. The wealth-building playbook is simple. It starts with saving 10-15% of your income and then investing in a very low fee manner. Same as what Larry said, what I always said/say.

Building incredible wealth ain’t rocket surgery.

Speaking of incredible wealth, here’s how the Canadian banks and investors made out for the week.

• CM up 4.78%
• RY up 4.52%
• TD up 3.95%
• BNS up 2.66%
• BMO up 1.39%
• NA up 1.07%

Here’s the insane historical performance of the Canadian banking sector. The NAV is the total return of ZEB. The Canadian banking sector ETF, ZEB-T was up 3.01% for the week.

Here is a very good page on the Canadian banks courtesy of WOWA. You’ll find a comparative, interactive performance chart going back to 1995. The page includes very detailed analysis.

Over the longer term (think decades) the Canadian banking sector beats just about everything, even the U.S. stock market. That said, we don’t want to get too excited. We should always embrace a global portfolio and avoid that Canadian home bias.

Now, let’s have a look at the earnings and the crazy week that was …

TD Bank (TD-T)

Revenue decline: $15.49 billion down o.1% year over year.

Adjusted earnings per share of $2.18 up 26.7% year over year.

Royal Bank of Canada (RY-T)

Revenue growth: $17.21 billion up 14.2% year over year.

Adjusted earnings per share of $3.85 was up 25% year over year.

Scotiabank (BNS-T)

Revenue growth: $9.8 billion up 14.8% year over year.

Adjusted earnings per share was $2.56 up 22.9% year over year.

Check out Canada’s top robo advisor – Justwealth

Bank of Montreal (BMO-T)

Revenue growth: $9.34 billion up 4.2% year over year.

Adjusted earnings per share of C$3.28, up 72.6% year over year.

CIBC (CM-T)

Revenue growth: $7.58 billion up 14.5% year over year.

Adjusted earnings per share of C$2.21 up 16% year over year.

National Bank (NA-T)

Revenue growth: $3.7 billion up 25.9% year over year.

Adjusted earnings per share of C$2.82 up 9% year over year.

Canada’s Largest ETFs Performance

And here’s the performance of the largest ETFs in Canada for November.

The good news is that Canadian ETF investors largely opt for the core index-based ETFs. Here’s how to arrange a very simple meat and potatoes Canadian Couch Potato ETF portfolio.

From that table we see that Canadian stocks ruled in November, and that over the last year Canadian stocks and International stocks have greatly outperformed the U.S. markets. That might be a bit of a head-scratcher, but nothing you have to worry about, or think about, if you’re holding Canadian, U.S. and International equities and you’re rebalancing on schedule. The rule applies whether you’re holding ETFs or stocks, or a mix of both.

Check out Retirement Club for Canadians

With respect to the Canadian banks, I’d suggest that you consider holding them all or pay up and use BMO’s ZEB. I’ve yet to see anyone who can predict the best performing Canadian banks. Who would have thought that CIBC would be a top performer over the last 5 years, or that TD would go from lead money launderer to cleaning up in 2025? Not me.

More Sunday Reads

At Findependence Hub a very good look at bonds. There are some very telling tables within that post.

Bonds are largely misunderstood and the poor performance of bonds in 2022 has caused most investors to have long term memory issues. Bonds work (provide portfolio ballast) in severe market corrections, they just don’t like inflation shocks cause rates are likely going up in the attempt to crush inflation. Rates up, bond prices down.

From that post link, the performance of bonds through the two major corrections of my investment life …

The longer the bond duration, the greater the inverse relationship to stocks when stocks get crushed.

On the ‘hurt side’ during an inflation spike, the longer the duration the greater the bond price decline. If you want to hold an all-weather portfolio, you’ll also include some dedicated inflation-fighters. Through 2022 we (for my wife and I) we held gold and oil and gas stocks and the Purpose Real Asset ETF – PRA-T. Those assets surged.

Keep in mind that inflation-fighters can stink the joint out during long periods of low inflation and disinflation. And mostly, that’s what we’ve had over the last 50 years. Those in the accumulation stage might forgo inflation protection, while retirees and those who are near retirement might consider dedicated inflation-fighters. I’ll leave that decision up to you.

The social circle in retirement

At Booming Encore a very thoughtful and important post on how Booming Encore founder Susan Williams rebuilt her social circle in her 50s.

I used to have quite a number of close friends before my kids were born. But as my life shifted and in moving to a new city, I found my time was very stretched and just keeping up with my career and kids activities took the majority of my time and my friends from where I used to live started to fade. So for years, my primary source of socialization came through my kids’ activities – their soccer, hockey and weekend tournaments – as I spent alot of time with other parents. But when it was over, I discovered many of these relationships turned out to be more circumstantial, built primarily around our kids and their activities.

Wow, that quote mirrors our life. Our kids’ sports became our life, our sporting families became our friends. Most of it faded away when the games were over. It takes an effort and a ‘strategy’ to keep friends and build relationships. That’s a very good read.

A Stocktrades Dan suggests that most of us will miss the investment opportunity of the next 10 years.

What Canadian companies will benefit from the massive infrastructure spending outlined in the latest Canadian federal budget?

What’s the GIC alternative?

The Loonie Doctor blog looks at: Canadians love GICs, can they do better? Granted, that is a BMO paid post, but BMO does get a free pass in my books; they are the only Canadian bank with a massive ETF franchise. There are some good ideas in that post.

In the fixed income camp I would add annuities. They can be part of your fixed income bucket. They are also part of your pension bucket. At Retirement Club we recently dove into HELOCs and reverse mortgages and how they might fit into your overall retirement plan.

Dividend Hawk looks at his dividends and portfolio news for the week. That certainly includes the big Canadian banks.

GenYMoney looks at the family portfolio as it hits an annual dividend milestone. Readers of this blog will know that I’m not a fan of counting dividends, but if it keeps an investor motivated and focused, we can put that in the plus column. All said, in the accumulation stage the goal should be to go for the greatest total return. It’s a fact that more money will create more retirement income.

The big portfolio problem

From this video from Retirement Planning Simplified looks at the optimized retirement cash flow plan for a Canadian couple with very generous $3 million in investment assets. It’s common for those who have saved and invested well.

Here’s a summary of the benefits of the retirement cash flow plan.

And, some additional benefits …

Once again we see the same, and very effective retirement strategies outlined. When you learn these basic concepts you’ll discover that it is possible to effectively self-direct your retirement plan and retirement income. You might also get a second opinion from an advice-only planner.

That’s what we do, and learn, at Retirement Club. Click on Contact Dale if you’d like to join us for 2026, or if you’d like an online tour of the club.

Join Cut The Crap Investing

You can follow this blog, it’s free. Newsletters, plus other free content and ‘ideas’ will be delivered to your email inbox. Enter your email in the subscribe area, or ‘join us today’ on the home page.

ETF Portfolios / Stock Portfolios / Retirement Strategies / Wealth Creation/ Retirement Club

Thanks Partners

Earn a break on fees by way of many of these partnership links.

Here’s Canada’s top-performing Robo Advisor, Justwealth. You can get advice, planning and low-fee ETF portfolios all at one shop. Canadians can have it all.

Consider Justwealth for RESP accounts. That is THE option in Canada with target date funds that adjust the risk level as the student approaches the College or University start date.

OUR SAVINGS ACCOUNTS

Make your cash work a lot harder at EQ Bank. RRSP and TFSA account rates are at 1.75%, other savings rates up to 3.0%. You’ll find some higher rates on GICs up to 3.60%. They also offer U.S. dollar accounts at 3.0%. We use EQ Bank, they have been awesome.

OUR CASHBACK CREDIT CARD

We make between $40 to $70 every month! And that’s on everyday spending. There are no fees with …

The Tangerine Cash Back Credit Card

For November we received $46.19 in cash from everyday spending. You can select 3 categories for 2.0% cash back. Remaining categories pay up at 0.50%.

That cash went into my TFSA account to help buy some CBIL-T, CHPS-T and bitcoin. I always top that up and make a few investments.

Join us at Retirement Club today

Do retirement right. … a series of monthly Zoom Presentations, newsletters, plus a secure and private online space where we learn, share ideas and connect with members. Here’s the Retirement Club overview page. New members are signing up now. You’ll join Retirement Club Group Two for the last two Zoom presentations of 2025, and then carry on with the full Group Three in January of 2026.

In December Jason Heath of Objective Partners will take us through some of the estate planning basics.

Make sure you’re doing retirement right. It’s also suitable for those who are approaching retirement. Use Contact Dale if you’d like more info, or to sign up.

While I do not accept monies for feature blog posts please click here on the mission and ‘how I might get paid’ disclosures. Affiliate partnerships help me (try to) pay the bills for this site. But they don’t, ha. That will allow me to keep this site free of ads and easy to read.