Why We Decided To Bet Against Canada

Latest Startup Investment Opportunities:

A Painful Visit For Canada’s New Prime Minister

Canadian Prime Minister Mark Carney couldn’t have been encouraged by President Trump’s comments ahead of their meeting on Tuesday. As ZeroHedge reported: 

Update (1130ET): Ahead of his meeting with freshly elected Canadian PM Mark Carney, President Trump has made his feelings clear about the relationship with USA’s northern

neighbor.

In a post on his social media platform Truth Social, President Trump

“I look forward to meeting the new Prime Minister of Canada, Mark Carney. I very much want to work with him, but cannot understand one simple TRUTH – Why is America subsidizing Canada by $200 Billion Dollars a year, in addition to giving them FREE Military Protection, and many other things?” 

Trump then went further:

“We don't need their Cars, we don't need their Energy, we don't need their Lumber, we don't need ANYTHING they have, other than their friendship, which hopefully we will always maintain. 

They, on the other hand, need EVERYTHING from us! 

The Prime Minister will be arriving shortly and that will be, most likely, my only question of consequence.

Things didn’t get better for Carney once he got to the White House. A reporter asked Trump if there was anything Carney could so in their meeting that would prompt Trump to lift his tariffs. Trump said no. Asked why, he said, “That’s just the way it is.” 

So, once again, it looks like the Trump tariffs are set to continue. 

The Trump Tariffs Continue

As we’ve mentioned before, the $64 trillion question is whether Trump's tariffs are intended to balance trade (in which case, they're sticking around) or a negotiating tactic (in which case, they'll be rolled back).

On Sunday, we got two more indications that they're meant to balance trade. The first was in a WSJ op/ed by Treasury Secretary Bessent, in which he wrote, "Tariffs are an effective tool for balancing international commerce." (counterpoint: today Bessent suggested there could be trade deals as soon as this week). The second was a new tariff announced by President Trump, a 100% tariff on foreign movies.

Angle On: Canada

A lot of movies shown in the U.S. are at least partially filmed in Canada. We had already bet against a Canadian trucking name last week,

So we decided research other possible Canadian stocks we could bet against. We looked for names that met these three criteria:

1. Have shares traded in the U.S.
2. Have options traded on those shares.
3. U.S. tariffs are likely to be materially negative for them. .

And we came up with five:

On Wednesday, we placed bearish bets on all of them. You can read the details about that here. 

And if you’d like to add some downside protection here, in light of legendary hedge fund manager Paul Tudor Jones’s warning about new lows, you can download our optimal hedging app by aiming your iPhone camera at the QR code below (or by tapping here, if you’re reading this on your phone). Our app can help you find the least expensive hedges given your risk tolerance and time frame.

If you’d like to stay in touch

You can scan for optimal hedges for individual securities, find our current top ten names, and create hedged portfolios on our website. You can also follow Portfolio Armor on X here, or become a free subscriber to our trading Substack using the link below (we’re using that for our occasional emails now).