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Trade War with the USA: Should You Change Your Investment Portfolio?
By Martin Cloutier, CFP®, CIM® – September 1, 2026
Tariffs, political uncertainty, and renewed trade tensions between Canada and the United States can make investors feel like they need to do something immediately.
Should you sell? Move to cash? Reduce Canadian equities? Get out of U.S. investments?
Those questions are understandable. Trade wars can affect corporate profits, inflation, currencies, interest rates, and ultimately stock prices. But reacting to every headline can create a different kind of risk.
Rather than trying to predict what governments or markets will do next, periods of uncertainty can be a useful opportunity to ask a more important question:
Is your portfolio actually prepared for different possible outcomes?
Retired? Review Your Cash-Flow Wedge
Market downturns can be particularly important for people who are already retired or approaching retirement.
A younger investor who is still contributing to a portfolio may have years to allow investments to recover from a decline.
A retiree taking regular withdrawals may not have the same flexibility.
If markets fall significantly, will you have enough lower-volatility investments available to fund your lifestyle without being forced to sell growth investments while they are down?
This is where a properly structured cash-flow wedge can become valuable.
The purpose of a cash-flow wedge is not necessarily to avoid investing. It is to provide enough liquidity and lower-volatility assets to help fund near-term spending needs.
During a difficult market, that reserve can potentially provide something extremely valuable:
Time.
Time can allow growth investments an opportunity to recover before they need to be sold.
Why Moving Everything to Cash Can Create Another Problem
When uncertainty rises, moving an entire portfolio into cash can feel safer.
But selling is only half of the decision.
You also need to decide when to invest again.
That second decision can be even more difficult.
Markets often begin recovering before the economic or political news feels reassuring. An investor can therefore be completely correct that serious risks exist and still make the wrong investment decision by remaining on the sidelines for too long.
Waiting until the “coast is clear” may mean waiting until markets have already moved.
This is why uncertainty should often be used as a reason to review rather than react.
Watch the full video to learn more!
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Disclaimers: Any view or opinion expressed in this article are solely those of the Representative and do not necessarily represent those of Harbourfront Wealth Management Inc. The information contained herein was obtained from sources believed to be reliable, however accuracy is not guaranteed. The information transmitted is intended to provide general guidance on matters of interest for the personal use of the viewer, who accepts full responsibility for its use, and is not to be considered a definitive analysis of the law or factual situations of any individual or entity. Any asset classes featured in this presentation are for illustration purposes only and should not be viewed as a solicitation to buy or sell. Past performance does not necessarily predict future performance, and each asset class has its own risks. As such, this content should not be used as a substitute for consultation with a professional tax or legal expert, or professional advisors. Prior to making any decision or taking any action, you should consult with a licensed professional advisor.
Harbourfront Wealth Management Inc is a member of the Canadian Investor Protection Fund and the Canadian Investment Regulatory Organization .
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