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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: ETF to invest in AI in Canada .
Read Answer Asked by Scott on July 25, 2023
Q: I listed in descending order securities that under performed since their 2022 highs. Please rank the securities in order of the best chance to recover their losses when we get back to the risk on mode. Thank you
Read Answer Asked by Richard on July 25, 2023
Q: I read an article recently that talks about the validity of ETF's. Can you make your comments about this!

Terms are that, each share of an ETF is an IOU.

As an example what happens behind the scenes when an ETF buys gold?

The actual metal purchased is stored by a custodian such as a major bank like JP Morgan or HSBC – yes, the same banks that have been investigated for silver and gold manipulation many times in the past.
But what you may not know is that the value of each share you own, or more specifically, the share-to-metal ratio, actually decreases the longer you hold it.

For example, the fund that manages the ETF must sell gold to pay for expenses, reducing the amount of gold tied to each share.
That's one of the reasons ETFs should NEVER be considered a long-term investment.
In other words, ETFs are not the way to go if you're looking to gold as a store of value or as an insurance policy against fiat currencies.

The same goes for Bitcoin ETFs.
Over time, the ETF fund will sell some of its Bitcoin to cover operating costs and management fees. As a result, an investor's unit will gradually hold a slightly smaller amount of Bitcoin than their initial purchase.

I would appreciate receiving your comments about this information!
Thanks.
Read Answer Asked by Terry on July 25, 2023
Q: In an answer to Bruce on Horizons enhanced ETF's your reply was " We are not fans of leveraged ETF's " ...... As these are nothing like the multiple times leverage products that are generally for day traders I wonder why ? According to their website their leverage is achieved through " borrowing " . As the market ultimately goes up in the long run I don't understand this.

Please explain it to me using the following fictional example ..... The year is 2008 and an ETF like this exists. It is purchased and suffers the crash of the banking system the following year in 2009.... It continues to be held and years later it suffers the covid crash ..... The year is now 2023 and the market is higher than the highs of 2008 and the recovery after the Covid crash...... Am I wrong in assuming the ETF price of one of these enhanced ETF's will be 1.25X the current value of the market and be considerably ahead of whatever my purchase price was in 2008 ? Please explain what is wrong with my reasoning ? ......{ I know there is something wrong with it. I just don't know what it is } ......
Read Answer Asked by Garth on July 25, 2023
Q: I would like to dip my toe into the AI waters using an ETF several of which you have mentioned. Unfortunately they are all on the NYSE.Am I wrong, as a Canadian, in avoiding the NYSE for fear of endless red tape and possible US taxes? I assume that there are no AI ETFs on the TSX or you would have mentioned them, I may have missed them.Thanks in advance and for all your great work.Rick
Read Answer Asked by Rick on July 24, 2023
Q: If I understand what I have been reading in your comments is that small caps in general are down but have good potential if the economy gets back on track. What would be your favourite Canadian traded ETF to capture a small-cap rebound in Canada and your favourite that trades in the US?
Read Answer Asked by David on July 24, 2023
Q: Maybe the Globe's listings are simply inaccurate. But it shows HTA as doing much less poorly than HTAE, which basically only invested in HTA and has a higher monthly dividend. The G&M shows HTA is up 33% ytd but HTAE is up almost 44%. I get that HTAE can have various strategies, including leverage - though it's odd that it seems as stable than HTA. What do you think of this ETF and its risk factors? Esp as compares with HTA.
Read Answer Asked by John on July 24, 2023
Q: I am of the view that Canadian Real estate may be coming back. Are there any Canadian real estate etfs that include non- reits as well ( for example would include Tricon) .
Read Answer Asked by Murray on July 21, 2023
Q: Hello, I am thinking about selling my position in QQQ in favour of small cap etfs spread amongst value and growth. My feeling is that over the coming years they will have a better growth factor than the current large cap companies listed in QQQ. How do you feel about the ETFs described above, or perhaps some alternatives you favour ?
Read Answer Asked by Robbie on July 21, 2023
Q: Hello Peter and all at 5i: With water going to be a big concern in the future I would appreciate your thought on companies or etfs to invest for this commodity. Thanks as always. Barbara
Read Answer Asked by Barbara on July 21, 2023
Q: These covered call, leveraged ETFs seem to be very popular right now. Fees seem to be high in general on these funds, 2-2.5%. Horizon just introduced a suite of ETFs including the above 2 which I am interested in. They are funds of their own funds and usually products like this waive the management fee of the underlying fund. Do you know if this is the case for these 2?
I’m hoping Horizons large scale will allow them to keep their fees under control.
Read Answer Asked by Bruce on July 20, 2023
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