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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: Further to my question about S&P500 etfs, is it better to buy a U.S.-traded or TSX-traded fund, given the current $ situation? Thank you.
Read Answer Asked by chris on March 20, 2020
Q: I know very little about bonds and most ad advisers suggest some bonds for a 73 year old like me. Is this a good time to add bonds to a RRIF? If so, what bonds or bond funds do you recommend?
Thank you for your service.
Don
Read Answer Asked by Donald on March 20, 2020
Q: Dear 5i
I'm always a little confused as to which companies are CDN hedged and which are not . Just because it's listed on the TSX doesn't` always mean that it is hedged I'm guessing . I'm also assuming that it looks like the CDN dollar is going to be weak compared to the US dollar for awhile .That being said which of the ETF`s listed above are CDN hedged and is it wise to have a balance of hedged and unhedged anyways ?
Typically you expect share prices to rise as earnings increase . With the state of the economy ie covid19 it is likely that earnings will be lower for the next couple quarters at least so there are few expectations for higher earnings from most companies .Given this , would you expect the market to rebound higher even before there are rising earnings simply on the anticipation that higher earnings will eventually happen once covid19 is proven to be under control , or do you think we would actually have to wait for increased earnings to occur before we would see any meaningful bounce in the markets ?
Please deduct points appropriately .
Thanks
Bill
Read Answer Asked by Bill on March 20, 2020
Q: To several members, you've suggested an S&P500 etf. Among those are ZSP, XUS, VFV and HXS, all trading on the TSX in Canadian $. They all appear similar, except that HXS pays no dividend (why?). Then there's SPY, trading on the US exchange. It has dropped considerably more than the Canadian versions, and consequently has a higher dividend yield. Can you explain the discrepancy, please? Don't they all hold the same stocks? And there must be other S&P500 ETFs trading on US exchanges, besides SPY - could you please name some? Which version of these ETFs would you choose?
Read Answer Asked by chris on March 19, 2020
Q: Which best bang for the buck should a retiree look at when looking for some US exposure through ETFS, for the future recovery, I have no US exposure as of now and would like to take advantage of the downturn, I get by on the pensions I have.
Thank you.
Read Answer Asked by James on March 19, 2020
Q: Thanks for your calming influence these days. Also appreciate your expression of empathy in your market update: we all recognize that what is unfolding brings a lot of emotional strain.
I own some ZWB because for the last few years didn't really see any catalyst to make banks move rapidly. Its Beta is 0.94. I am wondering if ZEB would be a better holding during the recovery with its Beta of 1.02. Does the "covered call" aspect of ZWB carry a downside for such market conditions?
Thank you.
Read Answer Asked by Marilou on March 19, 2020
Q: Could a covered call fund on a major index ever stop paying dividends? I realize they could plunge 50% or more in value. Thank you.
Read Answer Asked by Jerry on March 19, 2020
Q: Thank You for continuing to be the voice of reason for the amateur like me!!

What ETF's are best for 5-10 year hold for the following markets
US S&P, UK, Germany, China, Russia, Asia (general), South America (general), Africa (general). Looking to take advantage of weakness and average in.
Read Answer Asked by Lorne on March 19, 2020
Q: Dear 5i
With the recent chaos in the markets i had gone to mostly cash but kept the bond ETF`s ( CLF , CBO , XBB , ZAG ) , only to watch them go down quite a bit as well . It's a bit concerning to think that i was well protected to the down side ( at least i thought i was ) , only to see bonds go down . You would think with interest rates going down ( generally good for bonds ) bond yields going down that bond prices typically go up . But such haven`t been the case . In light of all this should i be temporarily reducing my bond exposure or is the worse over do you think for dropping bond prices ?
Would appreciate your insight .
Thanks
Bill C.
Read Answer Asked by Bill on March 18, 2020
Q: XRB is 100% government bonds and is now trading at a substantial discount to NAV. How can this be as the bonds are all government issue and (hopfully) the government is not going to default? Is this another case of dumping anything for cash or is something else happening? Would you enter a small position here as hedge against inflation down the road?
Read Answer Asked by Ronald on March 18, 2020
Q: Hello,
Please comment on my logic based on relative beta's :

If I sell my holdings of XTR and buy equal amount of ZRE, in theory, is there more of a chance that in a market recovery, the overall return for ZRE will be higher simply because it fell more and can therefore rise more?

Or is that too simplistic considering there are so many moving parts?

Many thanks!
Read Answer Asked by Arzoo on March 18, 2020
Q: Would you have any recommendations for individual corporate bonds with decent yield to maturity for up to a 7-year term? Based on my research, yield remains low for decent quality. Thank you!
Read Answer Asked by Pierre on March 18, 2020
Q: Hello,

I am already knee deep in BMO covered call ETF's and down 20% - 30%.

I can dollar cost down and buy more , take the high yield and wait for price to rise
OR
Sell and move on (to what?)

I believe 5i is wary about buying covered call options during a crash due to limited upside potential.

What could I do at this stage to get income of an equivalent yield and possible upside?

Cheers
Read Answer Asked by Arzoo on March 18, 2020
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