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MARKET OUTLOOK

Market paralysis has set in as investors who are frustrated by the political dithering in Europe and political gridlock in the US move to the sidelines. This paralysis is compounded by a growing fear of a global economic slowdown and a possible "Lehman moment" coming out of Europe. Global markets are relatively undervalued based on historical price-earnings data and will remain so until the outlook is less confused. Any modicum of good news may lead to a significant market rally.

Top Picks:

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Scorpio Gold

This micro gold producer, located in Nevada, is targeting 100,000 ounces of annual production in three years compared to an estimated 35,000 ounces this year. Its aggressive exploration program is targeting a substantial increase in proven reserves, which could significantly extend its mine life.

Inter Pipeline Fund

We see sustainable long-term low risk growth from its dominant position in oil sands pipelines, conventional oil pipeline gathering systems and it European petroleum and petrochemical business. This growth should provide the basis of steady increases in its distributions.

Agrium

In the short-term AGU should benefit from expected higher 2012/13 farm income and in the longer-term the increasing demand for food from developing nations. Agrium is one of the leading suppliers of crop nutrients, particularly for corn crops.

Past Picks:  July 20, 2011

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Daylight Energy (acquired by Sinopec 12/30/2011)

Then: $9.68

Now: $10.07

TR: +6.22%

Agrium

Then: $85.91

Now: $89.37

TR: +4.38%

Inter Pipeline Fund

Then: $15.80

Now: $18.60

TR: +23.95%

Total Return Average: +11.52%

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