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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: I am 53 years old. I have worked 31 years in my Federal Government job, making $100,000 + a year. I will have a defined benefit pension. Currently, I have a $200,000 in an RRSP, self directed,with 100% in equity divided 60/40 between CANADIAN AND US dollar investment. I am planning to retire in 2-3 years.

With this in mind, I want to rebalance my portfolio to make it more conservative. What ETF funds/percent allocations do you recommend to build the fixed income/bond portion of my portfolio both on the Canadian and US side of the house? What funds should I buy (Canadian and US) and how much should I buy of each?

Thanks in advance.
Read Answer Asked by Donald on October 19, 2017
Q: Like it or not there are market corrections. My question is about understanding investments and how they might react or respond to one, specifically ETFs.

On both Cnd and US business programs some commentators have expressed concerns about how ETFs could (would?) in their opinion be susceptible to far greater corrections than the markets themselves or what they track? The prime reason, they believe they are so broadly held, it could force a massive selling frenzy of their components? There is even some talk of a very large US private fund which uses them. It is considered by some rather secretive and creating suspicions as to their reasons? Sorry I do not recall the name. It would seem their fear, in a bad market, this fund might trigger serious downside consequences all on its own?

A seasoned professional with intimate knowledge and understanding of mutual funds said they are required to hold a certain amount of cash reserves for redemptions. If they become too high, they can actually suspend redemptions? The person identified one fund involved in the real estate sector which actually did during a sever correction. I understand real estate is a far less liquid investment but...?equities

My question, what safety measures exit with ETFs to avoid excess redemption impacts? Are there risk(s) a correction could expose, a potential Achilles’ heel of sorts? Something they have not yet revealed as an inherent structural risk?

I like their immediate diversification especially for foreign investments. Maybe I sound alarmists but I would like to believe I take the time to understand the products I use for investment and what to expect in both good and bad times. Are some types more vulnerable than others?

Any insights would be very much appreciated. Thank you



Mike
Read Answer Asked by Michael on October 18, 2017
Q: Jean earlier today listed a number of stocks in his/her portfolio as being in excess of 10%. You do not suggest there's a problem with this, so I'm wondering if it's okay to own larger percentages of individual stocks if one has diversified ETFs. I have been buying ETFs to consolidate holdings as I move farther into retirement to make withdrawals simpler. But I still have a lot of individual stocks that I'm keeping in the 5% range. I think I noticed elsewhere you recommend not holding more that 5% of a portfolio in ETFs( now can't find it, so perhaps I misremember). I suspect I'm just not getting something here. What do you recommend regarding this use of ETFs and individual stocks (and %s) for a person past the accumulation stage?
Read Answer Asked by M.S. on October 18, 2017
Q: I have not paid much attention to robotics and Artificial int. I found this US ETF and seems to be doing well.I was thinking 5% holding $9.000. in this area as I do not much tech in portfolio.Is there a comparable Canadian ETF and does 5i have any other stocks to compare with this ETF.Thank's 5I
Read Answer Asked by Guy on October 16, 2017
Q: Interested in placing direct investments in China, Japan & possibly India. Trading market must be US. Primary interest is Technology & Space.
This will be completely separate from our current traditional investments as reviewed occasionally with you over the years. Aside from established players in the above markets, I would consider vertically specialized ETFs that have a strong Bloomberg rating. Please deduct accordingly. Thank you.
Read Answer Asked by Robert on October 16, 2017
Q: Hello I am looking for a "one stop" etf that covers everything but US and Canada, which I am adequately invested in. I have checked the Vanguard Canada products such as VI/VIU but they seem to have a heavy concentration of investments in Japan (21-23% of holdings). Are you aware of another etf that may be appropriate? In the alternative should I consider one covering Europe and one covering emerging markets? Your thoughts would be most helpful. Thank you, Bill.
Read Answer Asked by Bill on October 16, 2017
Q: The recent issue of the ETF & Mutual Fund Update discussed two ETF’s in the U.S. Technology Sector, ZQQ and XQQ. In your opinion would BST:US be as good as or better than the above mentioned?
Thank you for considering my question.
Read Answer Asked by Gail on October 16, 2017
Q: Peter,
RESP first needed in 3 years with ~equal amounts of BNS, GUD, OTEX, PHO & T;
with cash for 2 more positions. What would you add or change at this time ? Thank you.
Read Answer Asked by Paul on October 16, 2017
Q: Good afternoon,

I am looking for exposure to the US market, in my RRSP. According to your previous answers on this type of inquiry, an ETF would be the easiest way to go, since it automatically brings both diversification and exposure.

My time horizon is minimum 10 years and don't mind a medium amount of volatility, as long as the returns are there in the end. My plan is to invest into the chosen ETF each year, so that my exposure to the US market is taken care of.

I have been looking more closely at VGG, VFV and VUN, mostly out of the reputation of Vanguard products. The dividend growth orientation of VGG sure is appealing, but I am not primarly looking for income. Aside from that they all seem pretty similar.

I would like to know your point of view on these ETFs I mentionned and if there are any others that you consider that would fit better in a long term plan.

Thank you very much!
Read Answer Asked by Pierre-Charles on October 13, 2017
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