Q: Hi team. I have ZWU as my main utilities holding @ 11% and I also have positions in BCE and ENB on their own. ZWU has both BCE and ENB in their top 10 holdings. In your opinion am I participating in "di-worsification" by holding BCE and ENB outside of ZWU. Would you sell both BCE and ENB and fold the funds back into ZWU? I'm ok letting ZWU go to +/- 15% of my portfolio. Appreciate your thoughts. Bill.
5i Research Answer:
ZWU currently has ENB at a 3.8% position. We no longer see BCE in its Top 10. So an 11% ZWU position adds about an incremental 0.4% exposure to ENB. Assuming BCE is just below the Top 10, its incremental exposure is probably similar. From a simplicity standpoint we would have no concern re-jigging positions into more ZWU. In a taxable account a loss on BCE (down 11% YTD) may also be beneficial.
Authors of this answer, directors, partners and/or officers of 5i Research and/or affiliated companies have a financial or other interest in ZWU.