How We Handled Monday’s Orange Selloff

Many claim to be contrarian investors who “buy low” and “sell high.” But how many actually follow through?

Here’s what we did last Monday as prices tumbled after Saturday’s tariff announcement.

First, we didn’t sell a single security in our client accounts. Second, we put to work the cash we had raised throughout January.

To our surprise, Orange declared that tariffs on Canada and Mexico would take effect on Tuesday, February 4—at a staggering 25%.

Our reaction on Saturday? Yeah, right.

By Monday morning, the TSX had plunged 3.1% at the open. We expected the tariff threat to be rescinded by day’s end.

One client, texting from Europe on Sunday night, joked, “Tell Doug Ford to cut the electricity during the Super Bowl!”

Regardless, we were ready to buy.

And we did.

Around 11 AM, we executed trades to buy our top Canadian equity idea for any client with enough cash.

By 4 PM, Orange backed down, retracting his baseless tariff threat.

The stock we purchased was a beaten-down Canadian energy royalty that rebounded as the week went on. During Monday’s selloff, it yielded nearly 9%—meaning that even if the price never rises, our clients will double their money on dividends alone every eight years.

Canada’s energy stocks remain heavily undervalued. We’re confident this royalty investment will appreciate over time while its dividend income continues to generate strong cash flow for our clients.

-written by Jeff Pollock