How could the tariffs affect your portfolio?

Concerned about U.S. tarrifs?

Adam Pukalo |

You are not alone if you are concerned about how your portfolio could be impacted by US tariffs.

There are always potential opportunities in situations like this. When there is a lower Canadian Dollar, it benefits Canadian companies that export goods and services to the U.S., as their products become more competitively priced. For example, companies like Canadian Pacific Kansas City and Canadian Natural Resources both have significant cross-border operations. A weaker Canadian Dollar could offset any tariff related pressure for these companies.

There is no doubt that tariffs can create short-term volatility, which is why it’s important to have companies in your portfolio that have diversified operations that give them flexibility to adjust to changing costs and trade policies. Knowing how the investments in your portfolio could perform is important.

What sectors of the stock market could feel the impact from the tariff announcements?

A stronger U.S. Dollar can increase input costs for Canadian companies that rely on U.S. imports, especially in sectors like consumer goods and transportation. For example, companies like Loblaw and Procter & Gamble could experience higher costs on imported goods, which would temporarily squeeze margins. There is no doubt that tariffs can create short-term volatility, which is why it’s important to have companies in your portfolio that have diversified operations that give them flexibility to adjust to changing costs and trade policies.

Remember, markets often react more to the news than actual stock fundamentals.