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Investment Q&A

Not investment advice or solicitation to buy/sell securities. Do your own due diligence and/or consult an advisor.

Q: If Canadian interest rates remain the same (or even go down) this year, while US interest rates rise, what effect would this have on Canadian companies/stocks in the telecom (T), insurance (SLF), bank (BNS), and utility (BEP.un) sectors? Thanks in advance!
Read Answer Asked by Jonathan on January 19, 2017
Q: Hi 5i,
Suppose the US moves into more significant inflation and begins to battle the strength of its own dollar. So rates ‘normalize’ but inflation goes ‘above target.’ I am thinking about how to adjust one’s portfolio for that environment. I guess gold and real return bonds (and TIPS) may be obvious inclusions but I am wondering about equities in general and what kind of equities, if any, can actually do well in an ‘above target’ inflation environment. How would you increase/decrease sector weightings? Could you identify a stock or two in some specific sectors that you think would be good to own in that picture? Is this topic something you’d consider blogging about at some point? Thanks!
Read Answer Asked by Lance on January 19, 2017
Q: We I currently own vfv in my husbands Rrsp account and have done quite well. Since he has now retired we are slowly repositioning his portfolio from income / growth to more income with safety we are thinking of selling vfv and purchasing a covered call etf that would still provide exposure to the us market. Do you think this is a wise decision,and if so what do you think of the Bmo Zwh? And which one would you purchase at this time-ZWH or ZWH.u? Are there other consideration we should be thinking about? Thank you
Maggie
Read Answer Asked by Maggie on January 18, 2017
Q: I'm building a non-registered account with companies that pay out a fairly high dividend (tax efficient for the dividend tax credit) and with an emphasis on growers. In particular companies that have indicated their intention of growing the dividend 5-10% annually and in some cases provided timelines as well. Looking for steady increasing income from this account but also hoping the increasing dividend will provide a floor for the stock prices against increasing interest rates expected over the next while. Time line 5-10 years.

For example, ENB who have indicated 10-12% dividend increases through 2024 (choose this over ENF who has indicated 10% increases through 2019). This should take ENB's dividend payout up to around 9%+ based on the current stock price. I've also included ECI in the account so far.

BEP/BIP don't fit the bill due to the distributions not being tax effective.

Looking for more ideas, perhaps 5-10 that I could consider adding to gain some diversification as well.

Thanks!
Read Answer Asked by Husseinali on January 18, 2017
Q: I'm aware of the interest rate and housing market sensitivity, but I'm still intrigued by the yield. Are the payouts of such MIC's classified as true dividend income (eligible for the dividend tax credit)?
If you aren't a big fan of these MICs, what would be your top 3 picks for companies with high (as safe as possible) yields (north of 6%)?
Thank you
Read Answer Asked by Carlo on January 18, 2017
Q: I was looking to take a position in BB, but I noticed that they have a convertible debenture paying 3.5% and convertible until 2020 at a price of $ 10, I think that this might be a better way to play it, what do you think?.I notice that there is nothing on the ask side, why is that, is it that thinly traded.
Thanks
Read Answer Asked by auftar on January 16, 2017
Q: I have been considering a purchase of AD, and am not sure if today's drop makes it more attractive or less so - are you aware of any news/actions that would result in the 4%+ price decrease? I am looking at AD more for income than growth, but obviously capital preservation is important. Would you buy AD today, why (or why not) and could you comment on the dividend sustainability.
Thank-you
Read Answer Asked by grant on January 13, 2017
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