Invesco Canada blog

Insights, commentary and investing expertise

Softwood lumber saga: Why duties may not be as bad for investors as feared


May 23, 2017
Subject | Active management | Trimark

In a continuation of a long-running trade dispute that dates back to 1982, Canadian softwood lumber exports to the United States were recently hit with an average countervailing duty of 19.88%, with additional anti-dumping duties to be announced in June (expected to be at least another 5%).1 This follows a 10-year period under a Softwood Lumber Agreement that required much less onerous export taxes from Canadian producers.

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Improvement signals in international equity markets

The Invesco International and Global Growth team has been managing international equities for 25 years. In that time, we’ve seen the performance pendulum swing widely across global regions and investment styles. But no matter the market conditions, our focus on EQV – Earnings, Quality and Valuation – has remained constant.

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Europe: Are elections overshadowing opportunities?

Ask any investor in Europe what concerns them most, and election risk will likely be near the top of the list. With French elections underway,German elections looming, and the fallout from the U.K.’s Brexit vote ongoing, that concern is to be expected. However, the Invesco International and Global Growth team believes that election risk – while real – may be overstated. Looking through our EQV (Earnings, Quality and Valuation) lens, we believe that valuations in the highest-quality companies are expensive, but we have been opportunistic in finding new names that are seeing short-term dislocations.

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Currency management: A simple roadmap

Global diversification has become standard practice among investors around the world. As the trend toward global investing grows, managing currency risk in global portfolios is likely to take on increasing importance. Sovereign wealth funds, central banks and other investors are likely to consider the benefits and challenges of currency hedging as their investment strategies become more globally focused. However, evaluating the impact of foreign exchange risk on portfolios and how to address that risk is a debated issue. Should global investors adopt strategies to specifically address currency risk or should they not?

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