Investment Q&A

Q: Rather than buy TIP directly, I am leaning towards buying XSTP and/or XSTH. Given that they are only 15% correlated (no doubt due to the CAD-hedged aspect of XSTH) I am leaning towards buying both. What is your perspective on this scenario for an income portfolio given the current state of U.S./CAD dollar exchange rates?

Q: Thinking of using the 10% cash in my kids RESP to buy QQQ. They won't need the money for 13 years. Does this make sense or is it too risky? The rest of the money is currently in VEQT.

Q: Is PDBC a good hedge against inflation and would you recommend it ? What is the dividend with PCBC ? The information on my TD acct. and your website are very different. Are there eff's that provide the same commodity exposure that pay monthly or quarterly dividends that you would endorse. Thanks for your help.

Q: Could you recommend some clean energy etfs that you think is a good way to play the sector? Thanks

Q: Can you comment on the investment merits of these two etfs.Are there others that you would see as more attractive for a diverse long term hold of both Canadian specific and US specific etfs?

Q: Dear 5i,
If one were to hold either VFV or VSP (CAD hedged) for approx. 25 years would you expect the Total Return to be the same for either ETF?
If VFV has long term better performance would it be because there are no CAD hedging expenses?

Q: Regarding US Equity Power Buffer ETF (PJUN): what is your take on this etf to hedge some of the potential downward movement of the S&P 500?. Or would you just hold more cash to try to hedge and protect the downside? How does this etf work and is it worth the MER?

Q: Now that i can get a GIC of over 4% what would be the advantage of owning HFR over a GIC ladder.

Q: I like TIP for its dividend and excellent lack of correlation to the rest of my portfolio. However, will its dividend and covered call income potential make up for its immediate seemingly dubious short and intermediate-term growth prospects? Thanks!

Q: Are there financial risks to Purpose Bitcoin, Ethereum and 3IQ etf's becoming insolvent other than the risk of Bitcoin and Ethereum going to zero. My understanding is they are not allowed lend, invest, etc. cryptos unlike Celsius, Binance etc. and your investment is safe. Please advise, Thanks for your expertise.

Q: I have heard leveraged ETF’s are not good long term holds. I am looking at QQQ but would TQQQ be fine for a long term investment (15-20yr)

Q: For materials sector is FXZ etf a good choice? Is the timing for purchase good right now? Any other suggestions and the outlook for future of this sector.

Q: Want to invest my Q2 USD div revenue, VIG, SPY or QQQ the better buy right now?

Q: Greetings,

With the Euro/ USD hitting parity are there any stocks or ETF's that directly reflect the weakness in Euro's and allow us to invest in Europe at what is hopefully a discount?

We own ZWE and VGK - Do they reflect the weakness and could we buy more?

Many thanks

Q: Emerging market indices have been underperforming for some time now and are ostensibly quite undervalued relative to peers in aggregate. I happen to hold a fairly sizeable portion of my portfolio (~15%) in XEC. As such, I am curious as to your opinion on whether or not holding emerging market exposure is a valuable form of diversification in today's landscape. Finally, acknowledging you lack a crystal ball, do you anticipate emerging markets reverting to the mean in the foreseeable future?

Q: I am a retired income investor who derives all his income from investments. For obvious reasons I am a fan of covered calls and own the various ZWs and HDIV. I also own the canadian banks and ENB. Most of these have held up fairly well in the turmoil. My question is do the covered call ETF administrators try to keep the return % approx level as the ETF value changes. I note that the RBC quoted return for HDIV is noeth of 10% but ZWC is approx 7% which is not much change from where it was in April. Other ZWs are similar. It would seem that BMO manage the return whereas Harvest do not.

Q: Do you have a preference between these 3 ETFs, or is it pretty much a draw?

Thanks.

Q: I hope all is well at 5i and you are enjoying the sunny summer. I wish we had more rain here in Niagara.

Garth asked an interesting question last week which you answered on Friday. He was asking about all-in-one ETFs and specifically such as VGRO, XGRO, ZGRO or HGRO. 5i recommended VGRO over ZGRO with no mention of HGRO.

I did my usual half-baked research (engineer not a financial guy) and found some interesting things using the G&M watchlist plot routines. I just plotted a comparison of ETFs using 1, 2 and 3 year intervals relative to last Friday (July 15th). First, I compared VCNS, VBAL, and VGRO. To my surprise, the worst performer for each relative time interval (1,2 and 3 years) was VCNS and the best by far was VGRO. For 1,2 and 3 years VCNS was -13.4, -7.5 and -3.7% while VGO was -12.7, 2.9 and 5.7% from July 15th). Seems Garth was on to something by asking about GRO ETFs.

Then I compared the 4 GRO ETFs that Garth was asking about. The one year returns relative to July 15th were all essentially the same at about -13%. However, HGRO was hands down the winner for the 2 and 3 year relative time periods from July 15th i.e., 10.6 and 20.5% for HGRO versus 2.9 and 5.7% for VGRO. I realize VGRO has a 2.2% dividend (according to G&M) but not that doesn’t make up the difference. I also realize HGRO is just shy of 3 years history but close enough for me.

Is HGRO doing something with significant increased risk or is something wrong with my research oven?

Maybe an article in your ETF & Mutual Fund Update report would be helpful.

Thanks, as usual.

Q: Good afternoon 5i,

TD has the dividend payments of VIU and VEE respectively at $0.80 and $0.86. Is there a withholding on these amounts since they're foreign or is that automatically built in to the price for share. I'm simply trying to estimate my dividend payment from both.

Why do their payments vary quarter to quarter when other ETF's (e.g. ZSP) keep the same payment rate per quarter?

Thanks in advance. - Jeff

Q: The Globe just had an interesting piece by a RY high yield bond fund manager and I'm curious about your thoughts on the gain potential which assumes inflation is defeated in a year or two. I am reluctant to pay fund fees again so if there is an ETF you can suggest which deals with corporate bonds it would be appreciated. thanks Al