Above the U.S. Canadian stocks last year outperformed the U.S. and most of Europe. Though Asian markets generally fared even better last year, Canada handily outperformed the U.S. and most of Europe.
Many investors still think of Canada's stock market as a play on natural resources.
What You Need to Know The weighting of Canada's resource stocks in the TSE 300 has long been declining as commodity producers disappointed investors and companies in other fields prospered. The Canadian gains have been driven by a relatively small group of highly valued stocks, which have masked sluggish performances by natural resources, financial services and industrial stocks. Canadians are pouring their money into high-performing technology funds that invest in Canada and abroad, while flows of money into mutual funds with a broad base of holdings in Canadian companies have slowed to a trickle. The split has left value-minded fund managers coping with subpar returns and wondering how to drum up interest in the overlooked shares of nontech companies. And some retailing stocks sell well below their book value, Mr. Michael adds.