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Canada is a highly non-diversified market

Even though Canada has representation in all ten sectors, and she has hundreds of companies in many different industries. It is highly non-diversified because most of these companies relate to natural resources in some way or another. 

This means that if your equity portfolio is 100% in Canadian equities, you run a high risk of a downside surprise. It’s been a great ten years, but that inductive evidence doesn’t preclude a nasty shock.

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