Investment Q&A

Q: (From Greg)
Scotiabank is selling its CIX (CI Financial) holding at a price of $31.60 in a just-announced secondary offering. Given that CIX closed today at $33.65, this seems to be a very good deal. What is your opinion? Should I commit to this offering through my broker (no transaction fees), or will the market price of CIX likely decline to meet this price anyway in the next few days?

Q: XSR - Could we please have your updated comments on Sirius - another special dividend announced today, 58.5 cents, yet the reaction thus far has been somewhat underwhelming - there always seems to be a lot of selling pressure on this one

Q: Hi 5i team,

I was wondering if I could get your thoughts on WestJet (WJA). Does the stock look cheap or expensive relative to peers?

Regards,


Brian

Q: I notice that you are getting a lot of questions regarding fixed income in a portfolio. Yesterday, for instance, someone asked about using utilities and other dividend paying stocks as a substitute for fixed income. I think the sense of the question was not really that dividend paying stocks are actually a substitute for bonds, but that under the current environment, it might be a viable option. Today, Ron asked about fixed income as and you responded that the Money Saver portfolio has a 20 per cent allocation to fixed income. I have sometimes seen 30 percent mentionned here as a reasonable amount.

I am not sure quite where to go with this, but I know that I am a little bit like a deer in the headlights regarding fixed income at this time, and I believe others are, as well. I don<t understand that asset very well. But, it seems counter intuitive to buy something that everyone says seems to have a high likehood of losing you money in the current or near future economic environment.

And even the amounts mentionned seem not to do what you would like them to do. What I mean is this: Fixed income, it seems to me, is meant to make the ride easier. You don<t go too far down, when you go down. And if there is a long term market crash, you protect some of your money. But, I am not sure how happy I would be if, say, our of a portfolio of one million, I managed to protect 200,000, or 20 percent; or even 300,000 at 30 percent. But, when you start getting to 40 or 50 percent, you wonder whether, again under the current environment, you are not being a little foolish in alloting this much to fixed income.

As I say, I am not sure where to go with all of this. But, it is a concern that I am coming to believe many here, as well as myself share. Possibly an article focused on this subject ands with explanations on the pros and cons of the various vehicles available might be an idea. I know that much depends upon the individual's situation and risk profile but the current economic situation is making it a little more problematic, I think.

I know that your work here is principally Canadian stocks but I thought I would express this anyway. So, please publish and answewr or not at your discretion.
thanks once again

Q: In my RRIF I am holding the First Asset Convertible Debenture Fund (DCD.UN) which trades at a discount to NAV and yields about 7.4%. It seems to be structured on derivatives - a forward agreement with a bank - a setup that is different from that of CVD, though the past performance looks similar. CVD trades at a premium to NAV and has a lower yield but I wonder if it is safer overall and in your opinion would you recommend a switch? Thanks, J.

Q: Need to buy pipeline stock in rsp, i know you like size of enb but ipl has not been mentioned lately would appreciate your option on buying right now
thanks

Q: Please compare the risk of CVD vs CBO. I note that CVD has a lower duration so I assume it would hold its value better should interest rates increase. Please comment on the duration and other risk factors. Thank you.

Q: Good Morning,
ARCP was recently a topic in Seeking Alpha. Could you please give me your update on this fast growing US Reit.
Thank you,
Rick

Q: Could you help me compare an investment in BAM versus BIP.UN,please.

Thanks
Bob

Q: Hi Team. I've seen your responses to various questions regarding Prairie Sky. I'm looking at purchasing some of this, but I would be interested in knowing how would you compare it to FRU which has been around quite a bit longer, and also has a nice yield.

Brian

Q: Hi 5i team
I have held Power Corp (POW) in my retirement account since Jan/94. It is now trading at about the same price as it did in Jan/09 and the dividend has not increased in at least 5 years. Would you consider still holding this stock and if not what would you recommend that has a similar dividend but is not in the financial sector? Thanks.

Q: What is your current opinion on Reitman's (RET.A, RET)? This was once a great company, but I sold my holdings last year and am considering slowly building a position for the long term. I prefer RET because it is cheaper even though it is voting stock, presumably because of the lower liquidity compared to the A shares. Thanks.

Q: 'Yearning for yield".

Would it be reasonable to consider some of the high quality utilities like FTS, PPL,TRP etc. to be substitutes for fixed income stocks such as GIC's or bond etf's?

A year ago US high income stocks like NLY, HTS, AGNC and MTGE dropped in price significantly and looked scary given the fear (terror) concerning interest rate increases. Given the current set of circumstances, would you be in favor of buying these now with the expectation of modest price increases but 10% plus yields for a 1-2 year hold - or is the risk/ reward still unattractive?

Thank you for all you help.

Q: Hi: I am interested in opening a position in Enbridge. Are there any near-term catalysts, positive or negative that I should take into account prior to investing? Does the Northern Gateway project pose any risks or has this already been priced in to the stock? Anything else you could tell me that would be material to my decision making process would also be much appreciated.

Thanks!

Q: As income sources in an RRSP which one would you regard as higher risk, XHY or TMC? Thanks

Q: Hi team:
I sold half of my position in CPD (i shares for preferred shares)
which I held for over a year, finally break even
I am looking for abit of income (dividends) with low risk for
capital appreciation
I already have WTE.un and Bep.un and Peyto, which one would you choose to add with the new money coming out from CPD ? thanks!

Q: Re: FTS.IR
I am an owner of FTS and have been quite interested in following the merger/take over of UNS. I have been part of other take overs/buyouts with other companies but can't figure out why the .IR units are pounding so much higher. I was hoping you would be able to tell me what is happening with these .IR units and why they are gaining so much. Thanks

Q: I have held BBD.B for a long time. With C series in difficulty, I would like to hear your opinion. Buy, sell or hold. BK (US) and BKL.

Q: Hello 5i team,
I have been reading your general guidelines on asset allocation in the various comments and have decided to add some fixed income in my portfolio.

My plan, in this case anyway, is to sell some companies that I hold in my RRSP and buy them back in my non-registered account.

One company that i am considering selling is Atco. Now, my question is whether, at this point in time, i would be better to buy back Atco, or one of its peers instead. I note in the RBC site that it cites Enbridge as a peer. I am not sure that they are the same but maybe so.
So, my question is whether i should buy a peer company or buy back Atco at this time? And on what basis would you decide this?
I should say that I suspect that Enbridge is fasting growing than Atco and has a higher dividend. I should say that I don<t immediatly need the dividend. Really appreciate your service and thanks for any help

Q: Good Morning, could I please have your updated view on CSE and any comments related to their recently announced financing.
Thanks