From a TD Green Machine Piggy Bank to Managing Millions: Coming Full Circle with Monica Yeung

Before we get into questions about equity markets, can you tell us a bit about your career path to where you are now?

I started my career at TD more than 17 years ago as a new business school graduate and I haven't looked back since.  One of the great things about working at the bank has been the opportunity to move through different areas of the business.  My first role was in Investment Banking advising outside companies on corporate finance transactions.  I then moved in-house into TD's Corporate Development group where I evaluated mergers and acquisitions (M&A) transactions for the bank's own balance sheet.  After completing an MBA at The Wharton School in the U.S., I found my way into TDAM in 2017, initially as an Equity Analyst covering Global Financials and Communication Services.  In 2022 I became Co-Head of Research leading our Analyst team while also taking on a more active role in portfolios as Co-Portfolio Manager on several Canadian dividend funds.  In 2024, I stepped in as Lead Portfolio Manager of the TD Dividend Income Fund.  

What are your thoughts on the current investing environment from a global perspective?

We are coming off an incredible run for equities, but there are many factors to consider at this juncture. On one hand, there's no shortage of risks to worry about – unemployment in Canada, weak global industrial production, risk of a recession and geopolitical conflicts, to name a few.  On the other hand, several factors suggest equities still have room to run.  For one, most major central banks around the world are cutting rates, which tends to be positive for equity valuations.  We also continue to see major fiscal spending in both the U.S. and Canada.  And finally, corporate earnings remain resilient with U.S. and Canadian earnings expected to continue grow into 2025.     

In the face of uncertainty, I continue to preach and practice our investment philosophy of owning high quality companies with strong competitive advantages, good pricing power and healthy balance sheets.  I feel strongly that these are the types of companies that can generate strong returns in any economic environment over the long-term.

What "themes" are you seeing today when looking at the markets?

After the U.S. Federal Reserve delivered its first 50bps rate cut in September, it's safe to say the global synchronized rate cutting cycle is firmly in play with most major central banks on a path to cut rates.  Closer to home, the Bank of Canada was the first of the G7 nations to lower rates in June, with expectations that it will need to follow of pace of faster and deeper cuts as it tackles weaker growth. 

In the hands of Canadian retail investors, this means that a Guaranteed Investment Certificate (GIC) or High Interest Savings Account (HISA) once earning 5% is now closer to 4% today, with the prospect of a 3-handle very much in striking distance.  Against this backdrop, we're starting to see a rotation into high-yielding Canadian equities such as the banks, utilities and pipelines, which offer 4-6% dividend yields with earnings growth plus the added advantage of a dividend tax credit.  If rates continue to fall, there is room for this rotation to continue and would look for that to be a theme to watch in 2025.  

What would have been the best advice you could have given yourself or investors over the past 12 months?

It's important to remember that market dislocations are often driven by fear or psychology.  This short-term volatility can feel unsettling in the moment, but it also gives rise to mispricing windows that can create incredible investment opportunities for investors.  

Any big "aha moments" that stand out in your investing career?

One of my earliest memories growing up was walking into my local TD branch with my dad to open up my first bank account.  I still have my TD Green Machine ATM piggy bank from when I was a kid.  I remember saving up my weekly allowance money, depositing it into my account, investing it into a GIC and watching my savings grow.  One big "aha moment" for me was realizing that life has come full circle more than 30 years later – from starting my own financial journey at TD, to now being a part of the bank and helping our clients reach their financial goals.  That gives me an enormous amount of pride and purpose in what I do each day as a Portfolio Manager at TDAM.  

What keeps you entertained outside of the office?

I have young kids that keep me busy and on my toes.  One of the greatest gifts as a parent is rediscovering the world through the eyes of our children.  I love taking them on long walks through Toronto's amazing ravine system, exploring parks, museums and discovering new coffee shops.  I grew up in Vancouver, so we also try to get out west as much as possible to visit family.