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  5. BMO: Worst case scenerio how much downside do you think the banks have in the next four years. [Bank of Montreal]
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Q: Worst case scenerio how much downside do you think the banks have in the next four years. RY,BNS and TD are all oversized positions. Thinking of lightening up in non taxable accounts or should I just sit on my hands ? Crystal ball gazing I know !
Asked by STEVE on February 14, 2025
5i Research Answer:

Banks are quite cheap, and seem to be pricing in lots of worry (tariffs, recession, inflation, rates). Anything can happen, of course, but it is not a sector we would be truly worried about. Barring a 2008-like scenario (unlikely) we might see 5% to 7% decline risk, but probably more than that in terms of upside potential. 

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