There are very few sectors in the Canadian stock market that are attractive to JF Tardif, he said, as investors remain “too complacent” in the face of rising recession risks.

“We're not quite seeing, right now, a recession in my opinion. And a lot of the stocks that have done well lately are the more safe stocks like Apple, so all the money is going into these stocks that people feel are safe. So, yeah, I agree with you, I think people are too complacent right now,” Tardif, president and portfolio manager at Timelo Investment Management Inc., said in a broadcast interview Thursday.

He said his portfolios only have about 50 per cent exposure to equities, and about a quarter of that is energy.

“We know there's an energy crisis in Europe. And the world consumes more energy every single year and in Canada, per capita, we have a huge amount of energy,” he said.

In addition to Europe’s energy crunch, rising interest rates and geopolitical tension have heightened concerns about a possible global recession, but in recent weeks, investors have appeared to be looking past those risks, leading to rallies in the stock market.

Tardif said he believes there will indeed be a global recession, the question is how severe it will be.

That severity depends on how fast Russia’s war against Ukraine and Europe’s energy crisis get resolved, he said. If they don’t get resolved quickly, a “recession is very, very, very likely” next year or even as soon as before the end of this year, he added.

“Overall, our exposures are very low because I'm really worried about the outlook for the economy,” he said.

With a possible recession on the horizon, he’s shying away from financial stocks.

On the other hand, his stance on certain real estate investment trusts (REITs) has changed as fundamentals turned in favour of the rental housing market.

Vacancy rates are already extremely low across Canada and increases in immigration will put more upward pressure on rental prices, Tardif said, despite REIT unit prices falling amid rising interest rates.

“That's why those stocks have corrected and that's why, in my opinion, now they're finally attractive,” he said.