Modern Investing Techniques — Episode 21

Modern Investing Techniques – Episode twenty-one (Expanded Script – 2,) Good morning everyone and welcome back to Modern Investing Techniques, episode twenty-one. I’m Patrick, coming to you from Vancouver on this Thursday, April sixteenth, twenty twenty-six. Whether you’re listening on your morning commute across the GTA, sipping coffee in Calgary, or squeezing this in during a lunch break in Halifax, I’m glad you’re here. Today we’re going to dissect what the market is actually telling us beneath the headline numbers, zoom in on how serious investors are confirming genuine A I momentum instead of chasing hype, talk about a silent portfolio killer that quietly erodes Canadian T F S A and R R S P returns, run through our simulated weekly Practice Investment, review last week’s flat result and the valuable lessons it carries, look at two free tools that can give you a genuine edge, and close with three Canadian-flavoured stories that could move accounts this week. As always, we do this with discipline, data, and a healthy respect for risk. Before we dive in, the standard but important disclaimer: everything we discuss on this show is for educational and entertainment purposes only. The Practice Investment of the Day is a simulated trade using purely hypothetical dollars — no real money is at risk. I am not a licensed financial advisor, this is not financial advice, and nothing here should be taken as a recommendation to buy or sell any security. Markets involve real risk of loss. Past performance, even simulated, does not predict future results. Always do your own due diligence and consult a qualified financial advisor before putting any of your hard-earned capital to work. Let’s start with the Market Pulse. Yesterday the S&P 500 once again showed why it remains the benchmark everyone watches. The index closed at seven thousand twenty-three, up 0.8 percent on the day, reclaiming record territory in near-record time after its recent pullback. What’s impressive is not just the new high, but the speed and conviction with which buyers stepped in. The NASDAQ Composite outperformed noticeably, closing at twenty-four thousand sixteen, up a solid 1.6 percent. That outperformance was driven almost entirely by continued strength in technology and A I related names, exactly the areas investors have been rewarding for the past two and a half years. Meanwhile, north of the border, the more diversified T S X Composite lagged modestly, closing at thirty-four thousand one hundred fifty-six, up just 0.2 percent. This divergence is classic: when global capital is chasing growth and thematic stories, the resource-heavy Canadian index often plays catch-up or rotates defensively. Sentiment right now appears supported by a steady drumbeat of positive corporate updates around A I infrastructure spending. Even with persistent macroeconomic uncertainties and the geopolitical clouds still hovering over the Iran conflict, companies with direct exposure to data-center buildouts continue to sound constructive. For Canadian investors this creates an important tactical consideration. We should be watching closely for any signs of rotation on the T S X into domestic defensives — especially after the Canadian Real Estate Association released a noticeably lowered 2026 home-sales forecast. That softer outlook signals slower economic momentum here at home, which often translates into lower interest-rate sensitivity in certain sectors and a preference for stability over cyclical exposure. The broader takeaway is that while the major indices are making new highs, the smart money isn’t blindly chasing the most obvious mega-cap names. They’re looking deeper into the supply chain for real confirmation that demand is not only real but accelerating. And that observation leads us perfectly into today’s Strategy Spotlight. Today’s Strategy Spotlight is all about supply-chain confirmation in a high-conviction theme — specifically A I infrastructure. The core idea is straightforward but powerful: instead of simply buying the end-demand names everyone is talking about, you deliberately track their critical suppliers and use upward revisions in guidance as independent confirmation that underlying demand is still accelerating rather than peaking. In an environment where the S&P 500 is making fresh all-time highs while Bitcoin has been stalled at resistance for weeks, this supply-chain lens becomes an excellent filter to separate genuine momentum from retail hype. Let me give you some context. We saw this playbook work beautifully during the cloud-adoption wave from 2013 through 2017. When the big hyperscalers started raising their capital-expenditure guidance, the companies that made the specialized networking gear, power systems, and cooling components began raising their own forecasts shortly afterward. Investors who systematically followed those supplier revisions captured meaningful outperformance versus the broad indices — often 400 to 700 basis points annualized during the early-to-mid stages of that multi-year cycle. The same logic applies today with A I. When TSMC raises its full-year outlook because A I related wafer demand keeps surprising to the upside, that’s not just noise — it’s a downstream signal that the entire ecosystem is still in growth mode. Implementation on everyday Canadian platforms is refreshingly accessible. Whether you use Questrade, Interactive Brokers, or even Wealthsimple Premium, you can screen for suppliers that have recently beaten earnings and raised guidance. Pay particular attention to commentary around A I buildout pace, order visibility, and capacity utilization. Once you’ve identified two or three names that check those boxes, the rule is simple: allocate only 5 to 10 percent of your thematic sleeve to any single name, and use the 20-day moving average as a trailing stop. This keeps the position sized responsibly and gives the trade room to breathe while protecting you from sudden trend reversals. Of course, no strategy is perfect. Risks include delayed inventory corrections that suddenly ripple through the chain or abrupt macro shocks — think escalation in the Middle East or a sharper-than-expected slowdown in U.S. corporate spending — that can truncate the cycle faster than anyone expects. That’s why the ironclad discipline here is position sizing: never let any single theme, even one as compelling as A I infrastructure, exceed 20 percent of your total equity exposure inside a T F S A or R R S P. Diversification isn’t sexy, but it’s what lets you stay in the game long enough to compound. Knowing when real momentum exists is only half the battle. The other half is making sure you don’t give back those hard-earned gains through hidden costs and structural inefficiencies. That brings us to one of the most under-appreciated lessons for Canadian investors — the silent portfolio killer known as bid-ask spread slippage, especially in E T F's around catalyst events. Picture this scenario. Last week, right after TSMC posted its strong results and raised guidance, you decided it was time to add to a popular A I themed E T F. You placed a market order and it filled at eighty-seven dollars and forty-five cents. At first you felt good — you got “in” on the news. But later that evening when you checked the tape, you realized the E T F’s net asset value had barely moved, and the price you paid was 38 cents above the previous day’s closing midpoint. What happened? In the first 18 minutes after the news hit, the bid-ask spread on that E T F widened dramatically — from its usual tight 4 cents all the way out to 42 cents. Market makers pulled quotes amid surging retail volume and genuine uncertainty about how the Iran conflict might ripple through global semiconductor supply chains. On lower-liquidity days this kind of slippage can easily cost you between 0.4 percent and 0.7 percent on a round-trip trade. For many active Canadian investors that’s enough to completely erase an entire week of outperformance versus the index. The pro tip most retail investors miss is to treat every E T F like a unique instrument with its own liquidity fingerprint. Before you ever click “buy,” check the 20-day average daily volume and the options open interest. If average daily dollar volume is below roughly twenty-five million dollars, professionals immediately switch from market orders to limit orders placed inside the spread. Platforms like Interactive Brokers give you excellent block-trading tools and depth-of-book visibility that make this easy. The biggest misconception is assuming every “liquid” E T F trades with the same tightness as a blue-chip Canadian bank stock. It simply isn’t true — especially in the first hour after major news or during overlapping geopolitical tension. The practical habit I want every listener to adopt is this: before hitting a market order around any catalyst event, open your broker’s advanced tape, verify real-time spread and depth, and decide whether a limit order or even waiting thirty to forty-five minutes for the spread to normalize makes more sense. Small habits like this compound powerfully over years inside a tax-advantaged account. Speaking of putting real capital — or in our case, simulated capital — to work intelligently, let’s move into the Practice Investment of the Day. Remember, this is purely educational. No real money is being risked. Today’s weekly hold is Lucid Group Incorporated, ticker LCID on NASDAQ. The strategy here blends a forward-looking fundamental catalyst around potential Robo-taxi partnership announcements with ongoing bill-of-materials cost reductions inside a challenged E V sector. Our A I driven analysis has been highlighting consistently positive analyst framing around both the Robo-taxi deal prospects and the manufacturing efficiencies Lucid has been delivering. On the technical side, the stock is currently trading near the lower end of its recent daily range. It sits below the 50-day moving average but is beginning to show early signs of volume pickup on positive news flow. Nearest resistance sits at the 20-day moving average, while meaningful support is approximately eight percent lower. For risk management I’m suggesting a stop-loss placed seven percent below entry to strictly cap the maximum acceptable loss on this simulated position. The target for this weekly hold is a 4 to 9 percent gain by Friday’s close. Confidence level on this idea is medium. We have two constructive fundamental factors lined up, but sector headwinds in broader E Vs plus the lack of immediate heavy volume confirmation introduce a layer of uncertainty. That’s exactly why we size these simulated trades responsibly and maintain predefined exit rules. This example is meant to demonstrate how to blend forward-looking catalysts with basic technical structure instead of simply chasing pure momentum. Listeners should pay close attention to the importance of predefined risk levels and the discipline of evaluating the position every Friday. These are the exact skills that separate structured investing from emotional trading. Practicing patience across a full five-day holding period also highlights one of the main reasons many retail portfolios underperform the indices over time — the lack of a consistent, repeatable process. Before we look ahead, let’s review how last week’s simulated hold performed. Last week we were in SSNLF on an earnings-surprise momentum play tied to A I memory-chip demand. We entered at sixty-five dollars and twenty-one cents on Monday’s open and exited at exactly the same price on Friday’s close, producing a 0.00 percent return or zero dollars on a simulated one dollars,000 position. Our running total across six trades now sits at thirty-three dollars and eighty-five cents. The win rate is two wins out of six trades, or 33 percent, with two wins, two losses, and two break-evens. The current streak remains even. The lesson here is important. Even when the fundamental story around A I memory demand stayed intact, immediate price follow-through was not guaranteed in the presence of broader geopolitical uncertainty. That tells us we should tighten our catalyst filter going forward: we will now look for both an earnings surprise and clear positive price action within the first two sessions before committing simulated capital. These post-mortems are where the real learning happens. Now that we’ve reviewed the numbers, let’s talk about two free or low-cost tools that can give you a real edge reading retail sentiment and avoiding value traps. First, treat high-quality subreddits like r/investing and r/stocks as real-time sentiment laboratories. Don’t just skim headlines — actively track recurring language around resistance levels, unusually heavy price action at certain round numbers, and any visible divergence between retail euphoria and what the S&P 500 is actually doing. I recommend creating a simple Notion page or Google Sheet template where you log the dominant themes each week and cross-reference them against price charts on Trading View. This habit often surfaces early warning signals well before traditional media catches up. It’s especially useful for Canadian T F S A investors trying to spot when retail fear or greed is diverging from institutional flows. Best of all, it costs nothing but 15 minutes a week and pairs beautifully with Trading View price alerts. The second tool is the Seeking Alpha Idea Scanner. Use its rating-change feed to filter for downgrades or guidance-cut alerts. This is an excellent way to avoid walking into value traps or even to surface short candidates if you run a balanced long/short sleeve. Set up a daily custom watchlist focused on consumer and service-oriented names. When you start seeing multiple downgrades clustering inside one sector, it frequently precedes broader rotation opportunities. The basic version is free; premium unlocks deeper analyst models and historical backtesting, but even the free feed delivers actionable intelligence for both core R R S P holdings screening and tactical satellite positions. Finally, here are three quick market-moving stories worth watching inside your T F S A or R R S P this week. First, Amazon is introducing a new fuel surcharge for Canadian third-party sellers who use its fulfillment program. While this may seem like a minor operational change, it has the potential to pressure already-thin margins for many small e-commerce businesses. That pressure could accelerate a shift toward domestic warehousing solutions or alternative platforms. Canadian investors should monitor for indirect beneficiaries among logistics, last-mile delivery, and warehousing names that could see increased demand. These names often fly under the radar but can offer interesting defensive growth characteristics inside a registered account. Second, regional craft brewers are absorbing significantly higher shipping costs as fuel prices continue to surge. Producers such as Nova Scotia’s Nine Locks Brewery have publicly noted that transportation expenses are now meaningfully eroding profitability. This is a micro-example of a macro theme: margin compression across consumer staples. Investors should watch for this pattern to play out more broadly and consider selective exposure to companies that either possess stronger pricing power or maintain formal hedging programs that protect margins. Third, the Canadian Real Estate Association lowered its home-sales forecast for 2026 amid what it called a “shaky economic start to the year.” This revision came after March sales already fell 2.3 percent year-over-year. The update reinforces caution around rate-sensitive domestic cyclicals and may continue to support defensive sectors or fixed-income allocations inside Canadian retirement accounts. For T F S A investors especially, this is another data point suggesting that patience and selectivity in Canadian real-estate-exposed names remain the prudent course. Just a quick recap of our simulated portfolio: six total trades, 33 percent win rate, two wins, two losses, two break-evens, cumulative profit and loss of thirty-three dollars and eighty-five cents. Average return per trade is 0.57 percent, best trade up 7.88 percent, worst down 7.49 percent. The current streak is even, and our A I analysis continues to learn from every single outcome to refine future filters. Before we wrap up, keep an eye on any further Robo-taxi-related announcements next week — they could provide the catalyst needed to test Lucid’s technical resistance and give us an early read on whether this week’s simulated thesis is gaining traction. That’s it for today’s episode of Modern Investing Techniques. If you found the discussion useful, please take 30 seconds to share it with a fellow investor who’s trying to move beyond simple index investing. Subscribe wherever you listen, and don’t forget to check the resources page on our website for the free tools, screeners, and broker checklists we mentioned. We’re back tomorrow with fresh market insights and another Practice Investment. Until then, keep learning, keep refining your process, and above all — invest with discipline. This is Patrick in Vancouver. Talk soon. END OF EPISODE *(,412 — approximately fifteen point five to sixteen minutes at natural podcast speaking pace)* This podcast is curated by Patrick but generated using AI voice synthesis of my voice using ElevenLabs. The primary reason to do this is I unfortunately don't have the time to be consistent with generating all the content and wanted to focus on creating consistent and regular episodes for all the themes that I enjoy and I hope others do as well.