Investment Q&A

Q: Hallo Peter, how would variable preferred ETFs would be effected by interest rate increase? Thinking of VRP, PGX (us), can you suggest a couple more of Canadian and US ETFs. Many thanks, J.A.P. Burlington

Q: Do you have a preference between these funds as a income generator and can you rank them from best to worst? Thank you!

Q: I presently have no exposure to Europe in my portfolio and wish to add a 5% position by buying a ETF. Should I buy edge or not edge ETF, seeing the weakness in the currencies? Income is not the primary goal but I want good total return of course. I prefer good quality companies, participating in the recovery as opposed to momentum plays or startups. Could you suggest one or two Canadian ETF.

Q: If memory serves me well, at one time you were recommending the FEZ ETF for European exposure. I bought some two years ago. More recently you have been recommending VE. What I like about FEZ in the current environment is that it has no direct exposure to the UK, a country that seems to have a cloudy economic future these days. VE, in contrast, has 29% of its assets in the UK. FEZ’s MER is a bit higher, but not by much, and its yield (before withholding tax) is also higher. FEZ has 50 holdings while VE has 1262. Are you leaning more toward VE these days because it can be bought directly in Canada while FEZ must be bought in the US market? Or is it the (modest) small cap exposure in VE that you like? Or the much greater number of holdings? Or something else?

Q: Hi 5i Team:
A couple of thanks first before getting to my question.
1. Thanks for the fantastic job you did on my portfolio review and the suggested transactions.
2. Thanks for your opinion and feedback on annuities.
I have some money to add to my fixed income. Are you still liking CLF for government bonds and CBO for investment grade corporate bonds. Time horizon is very long term. Or do you have some other suggestions.
Thanks so much.

Q: I hold the following ETF’s in a Non-Registered account. It is sort of a general purpose portfolio with a bit of emphasis on the health care sector (just because I think it is coming due). My question is with additional cash to add should I look for another ETF or add to the existing ones? I guess I am saying do I need more diversification or is there another particular sector I could emphasize?

Canada
iShares S&P/TSX 60 Index Fund

US
Vanguard US Total Mkt Ind ETF
AdvisorShares Focused Equity

Europe
Vangrd FTSE Dev Europe All Cap

Health Care
BMO EqWt US HthCare Hedged CAD
iShares Global Healthcare ETF

Emerging Markets
BMO India Equity Index ETF
Fairfax India Holdings
Fairfax Africa Holdings

Q: Would you put money into biotech seasonally ? In the past I have done well on Celgene ... However , I have taken quite a hit on Gillead, so I am cautious.
Or should I look at the ETFs for a broader/safer play ?

Q: I have an etf portfolio for my 3 & 5 year old daughters RESP account consisting of the following:
XCS(small cap) 6.5%
VDY (CDN Div) 26%
VEE (EM) 18%
VXC (Global)26%
VSP (American) 21%
Would you mind suggesting an ETF to help diversify the portfolio or would you feel comfortable continuing with these weightings given the long time horizon?
Thanks so much.

Q: I have recently raised cash in my portfolio and am wondering if you could suggest a good place to park it for some kind of return over an undetermined period of time. Are money market funds still my best bet?

Q: I don't currently have a stake in the US technology industry, and am thinking of using the recent pullback as a good entry point. What do you think of the US tech sector for a long-term hold? Could you comment on using XQQ to meet this objective and an appropriate percentage allocation? Are there any other TSX/CDN$ ETFs with large holdings in US tech that you would recommend instead?
Thank-you

Q: Good day,
Can you tell me why there was such a big volume spike in CBO today and is that a good or bad thing. Thanks

Q: Could you please list a few efts Canadian and US that would protect from a down turn in the market.

Q: Hi 5i team,
I currently have the above ETFs. I find that the dividend are a bit low (~2%). I was wondering if there are alternatives to the above in the 4-5% dividend range for income?

Andrew

Q: In my portfolio I am overweight in Canadian Financial (Banks) and the US tech stocks, but I have no exposure to the Materials sector (except gold.) Can you please recommend me a few materials and mining stocks (in the order or your preference) or do you suggest an ETF.
Based on the recent weakness of the sector is this the right time to get in this sector? or do you suggest that you should stay away

Q: Can you give your thoughts on holding this ETF for a long term hold. I have some for a few years and have done well and was thinking of increasing my allocation.

Q: Good Morning: I have been raising my cash holdings somewhat in light of a prolonged bull market with high equity valuations and increasing geopolitical risk. I have some of this cash in HISA's with an average yield of about 1.7% or so. However, I am considering putting some of it into a bond etf since I don't feel I have the know how to successfully put together a ladder of actual bonds. What I would like your opinion on is what would be the best 2 or 3 options in Cdn. bond etfs for preservation of capital combined with optimal yield (recognizing that the two are almost always working in opposite directions.) Of course, if you have another option for parking cash, that would also be appreciated. (I do have some preferred share holdings but past experience has taught me that they are not immune to market corrections.) Many thanks.

Q: To add some diversity to my Canadian holdings, over the last 5 years I've held VUS, VFV and VEF. VEF is about 11% of the portfolio. The 2 US ETFs have outperformed VEF almost 2 to 1.
My question is do you think it's necessary to have EAFE exposure? I'm thinking of selling VEF to raise cash so I'm ready for the next dip in north American markets. Thanks for all of your great advice over the years. cheers

Q: I have American money sitting in a US margin account and not earning any interest. Do you have a suggestion for a safe use for it that could earn us some income?

Q: Hi 5i,
Just a comment on Nino’s question and your answer about the choice between paying up for a REIT ETF like ZRE/XRE versus holding 8-12 individual REITs. My choice has been the latter and I have been happy with it. Your answer suggested that rebalancing 12 holdings annually would cost $120 at $10 a pop. My experience has been that the reality is much less than that. Because the REITs tend to move as a group more than their individual movements relative to the group, in holding 8-12 decent quality REITs I haven’t had to do more than 2 or 3 rebalancing transactions in any given year. Except for a couple of extraordinary years my REITs have really been low maintenance holdings. Cheers!

Q: VSB looks to include both government and corporate bonds. Is owning VSB the equivalent to owning CBO and CLF? Looking to reduce number of holdings and the MER on VSB is attractive. Is there something similar that includes corporate and govt short term bonds that you like better? Thank you for all that you do!