It is heartening to see the TSX 300 index climb the proverbial wall of worry to reach new all-time record highs. Investors, however, must be cautioned that two sectors, oil & gas and materials, now comprise almost 50% of this bellwether benchmark. In consequence, much like Nortel and all the high technology stocks of 1999-2000 this index has become unduly skewed toward a particular area – the natural resource sector. As a result, it should be noted, that for many investors, this Canadian stock market yardstick, in the short-run, has become extremely difficult to beat and penalizes portfolios which may be more conservatively diversified.
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