Trump-proof second chance financial innovation?
Over the next few weeks will be highlighting some key INK Research reports that can help identify potential opportunities as Canada sorts out the Trump administration's evolving tariff policies taking place during a period of heightened geopolitical risk. In terms of tariffs, financial services is one area that up until the weekend had not been targeted for action by the Trump administration. However, that changed when the US government threatened to impose undisclosed financial restrictions on Colombia over a deportation dispute. As reported by Colombia One, financial sanctions could potentially include the freezing of assets and financial transactions.
While Trump has backed off from financial sanctions against Colombia, it is still worth assessing the headline risk on a case-by-case basis in the Canadian financial sector on the chance that Canada receives similar treatment. It is with that in mind that we look at our January 27th Morning INK Report. In the report, we highlighted revenue cycle management stock Everyday People Financial (EPF). The company is focused on collecting debts and helping those who owe debt. As such, their core business does not seem highly exposed to Canada-US cross-border financial transactions that would be potentially at risk should the Trump Administration start to threaten transaction freezes. That said, Trump's policy development is fluid so one always has to be prepared for nasty surprises. We would also note that the stock has had a good run recently, and may be showing some technical signs of being overbought with an RSI approaching 80 at time of writing (see chart).
If you are not familiar with INK Research PDF reports, check out our video tutorial series found in our November 6th blog post where you will learn how to use them as well as other features on Canadian Insider. You can download the January 27th Morning INK "Second chance financial innovation" here>>
Meanwhile, the prospect of a tariff-plus approach of the United States that includes financial sanctions is good for gold in the medium term. We will have a chance to look at opportunities in the gold group when we publish the January Top 20 Mining & Crypto-equities report later this week.