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Hello Athletes, Agents, Parents, Trainers & others,
Playoffs have a special way of pushing us past our limits and showing us what we’re made of. To those who remain in battle on the road to their respective championship trophy and all the glory it holds; we wish you continued success. To everyone else, patio & BBQ season with the first round of NHL Playoffs ain’t so bad either… !
Now Let’s Get Down to Business.
In this Issue:
- ‘Picks’ Gets the Call
- Elick Represents His Country
- Yakemchuk Can’t Miss
- More Pain, Less Gain – Capital Gains Explained
- Trainer’s Corner with Mark Fitzgerald, Kelowna High Performance
- What does a good business look like?
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Owen Pickering
Coming off a stellar season with the Broncos, Owen received a promising opportunity as he was called up to join the Wilkes-Barre/Scranton Penguins. This move marks another significant step in his professional hockey career, offering him a chance to showcase his skills at a higher level.
Best of Luck & Play Tough Kid !
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Charlie Elick
Charlie’s work ethic and skill-set have not only made him a high prospect for the NHL draft in Las Vegas this June but have also earned him a coveted spot on Team Canada’s Under 18 team competing in Finland.
Congrats on Representing Your Country Charlie !
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Carter Yakemchuk
As the old saying goes, Numbers Don’t Lie. The Calgary, AB native put up an astonishing 30 goals this year with his hometown Calgary Hitmen (as part of a 71 point season) to lead all WHL Defencemen in Goals. Now there are a handful of teams hoping to call his name at the NHL draft in Vegas in a few short months.
Best of Luck at the Upcoming Draft Carter !
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More Pain, Less Gain
The Canadian Federal Government recently proposed BIG BLOODY changes to the Capital Gains tax rules. Now is your opportunity to educate yourself on this important topic because better understanding your biggest expense (Taxes!) is fundamental to growing your wealth efficiently over time.
What Are Capital Gains?
Capital gains are the profits you earn when you sell something for more than you bought it. This could be anything from stocks and bonds to a piece of artwork or real estate. For instance, if you buy a share of a company for $50 and later sell it for $100, your capital gain is $50.
In Canada, the government doesn’t tax the entire gain:
- 50% Rule: Only half of your capital gain is subject to tax. This is called the “inclusion rate.” In our example, if your gain is $50, only $25 of it is added to your income.
- Tax Rate: The $25 that is taxed will be added to whatever else you earn that year (like money from a job or a summer internship) and is taxed at your personal income tax rate. So, the more you make, the higher your tax rate might be.
***Special Situations
- Primary Residence Exemption: If you sell your main home, you usually don’t have to pay capital gains tax on the profit, which is a significant benefit.
- Other Assets: For other assets, like vacation homes or investments, capital gains tax applies, so planning when to buy or sell can be financially important.
What Changed?
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Under the proposal, the inclusion rate for annual capital gains realized above $250,000 for individuals would be taxed at a rate of 66%, (up from the current 50%). Any gains under that bar would continue to be taxed at the 50% rate. The changes would also apply to all capital gains realized by corporations and trusts, regardless of the $250,000 bar.
Why It Matters
- Smart Selling: Knowing these rules can help you decide when to sell something. For example, if you know you’re going to make less money next year, you might wait to sell your shares because you’ll be taxed less.
- Long-term Planning: Understanding these rules is essential if you’re thinking about investing or if you receive assets as gifts or inheritances. It can affect how you manage these assets.
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Trainer’s Corner
We caught up with former NHL strength and conditioning coach Mark Fitzgerald and asked his advice on what athletes should do when their season concludes. Alongside his business partner Travis Martell, the duo trains elite athletes from all over the country at their venture, Kelowna High Performance.
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What To Consider When Buying a Business
Our Canadian Equity Portfolio Manager David Atkins recently purchased shares in Canadian Tire, and we thought this would be a good time to highlight some key metrics David outlined in his decision to purchase Canadian Tire.
***We don’t expect you to memorize these metrics or use this information to make your own purchase decisions anytime soon, but it’s helpful to understand that we are analyzing and buying businesses for their operational success, not because a stock is trending online or popular at the moment for whatever particular reason. Our goal is to safeguard our client’s hard earned money and give them what we believe is the best opportunity to grow their wealth.***
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Revenue – how much money a business earns before expenses & taxes.
It’s important to look backwards to see sales & growth history – but even more important to ask yourself what is the likeliness that this company is going to continue to grow? We believe that owning a growing company over the long-term rewards shareholders.
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Earnings Per Share – a metric used to gauge the profitability of a company.
A company posting massive profits is obviously good, but if they have a very high number of shares outstanding, that will impact how much of the profit you individually earn as a shareholder. You can see EPS actually dropped in 2023, which affected the stock price, which gave us an opportunity to buy shares of this great business on sale.
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Dividends Per Share – how much a company pays out in dividends to each shareholder.
Similar to EPS, DPS is a clear look at what each shareholder earned / is forecasted to earn in dividends. We like to own companies that pay us directly over time to be shareholders (dividends) for a variety of reasons.
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We understand you have a lot on your plate, so please feel free to reach out if you are curious or concerned about growing & protecting your wealth efficiently. Financial stress does not allow you to achieve your full potential, we are here to help.
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