CIBC Capital Markets chief market technician Sid Mokhtari’s stock-picking matrix has screened a fresh top 10 “best ideas” list for investors in January 2025, including one name he recommended for tax-loss selling back in October.
Technical analysis generally focuses on trends in a stock’s price and volume over time, as opposed to fundamental analysis, using factors like a company’s financial statements and economic data.
Mokhtari says his “trendspotting matrix process” returned 23.82 per cent in 2024. The S&P/TSX Composite index (^GSPTSE) gained 18.5 per cent, prompting some to dub 2024 an “exceptional year for investors.”
Technical analysis can be tricky for novice investors to understand. Mokhtari explained his method in a recent interview with The Globe and Mail.
“We are scanning for names that may be part of an ongoing or developing theme such as fund flows, emerging or established narratives, or simply accelerating uptrend forces,” he told the Canadian newspaper in October. “The process, later, adjusts every name for seasonality.”
For January 2025, three of Mokhtari’s picks are from Canada’s energy industry, and three are in the financials category. The remaining four hail from the consumer staples, consumer discretionary, information technology, and industrials sectors.
Here’s the full list from CIBC Capital Markets:
Some investors view January as a bullish month for stocks, believing those who sold losing investments at the end of the previous year to offset capital gains taxes will return to the market to repurchase equities. Other factors said to be behind the so-called “January effect” include rising purchase activity by mutual fund managers at the start of the year, and the timing of year-end bonuses for certain types of jobs.
In October, Mokhtari included CAE (CAE.TO) shares on a list of Canadian stocks to sell in order to offset 2024 capital gains taxes. Shares of the Mississauga-based aviation training and services company were also included in his January 2024 “best ideas” list for investors.
Jeff Lagerquist is a senior reporter at Yahoo Finance Canada. Follow him on Twitter @jefflagerquist.
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