Shares of GoEasy (GSY.TO) have long been a favorite among SIA Practitioners, frequently appearing at the top of the SIA RS Matrix Reports and featured in many Daily Stock Reports. Today, we’re revisiting GoEasy, but this time with a notable update. Over the past week, GoEasy has shown a decline in relative strength across various SIA Reports, including the Combined Dividend Report, which is integral to the SIA Hypo CAD Equity Income Model. According to the SIA rules-based approach, shares are typically adjusted when they fall into the Neutral Yellow Zone and switch to a RED SMAX, which occurred overnight. Consequently, the proceeds from this adjustment will be redirected to AECON Group Inc. (ARE.TO), a leading Canadian construction and infrastructure company known for its growing project pipeline and strong performance. Relevant details for ARE.TO are clipped from the SIA Combined Dividend Matrix Report above. Examining the Point and Figure chart dating back to early 2020, we observe the periods when GoEasy shares were in favored zones. The SIA Hypo Model Portfolios first encountered GSY on May 13, 2020, when the shares entered the Favored Green Zone. At that time, the Equity Income Model acquired 11,514 shares at $51.71. Over the next 16 months, the shares showed significant growth, gaining $121.80 per share and resulting in an impressive 235% return. Following this substantial gain, SIA Hypo Models sold the shares after a RS Zonal Alert was triggered. Although the shares later fell to $87.05, indicating a RED zone pullback, they regained favor and were re-evaluated for purchase on May 1 of this year. A small gain was realized before another RS sell signal emerged, reflecting SIA’s commitment to risk management.
The performance metrics of the SIA Hypothetical CAD Equity Income Model further illustrate this approach. The model has achieved an 814.54% return since inception (live for 10 years, backtested beyond, gross of fees), compared to the iShares Canadian Select Dividend Index ETF (XDV.TO), which has returned 242.39%. This translates to a Compound Annual Growth Rate (CAGR) of 14.96%, versus XDV.TO’s 8.06%. The model also boasts a down capture rate of 36 compared to the benchmark’s 85, a Beta of 0.57 vs. 0.89, and an Alpha of 2.82 vs. 0.82 for XDV.TO. This model is frequently used by Elite Advisors as a component in a broader North American strategy, often combined with other SIA Model sleeves like SIA's 5-Stock NASDAQ, 5-Stock S&P 100, and 5-Stock Canadian Models, for an 'Optimus Prime' portfolio.
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