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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: Re Louisa question today - If by tax reporting she means the T1135 "Foreign Income Verification Statement", it would not be considered foreign content for that purpose and would not have to be reported. Post if you wish.
Read Answer Asked by Christopher on January 20, 2015
Q: This question is about establishing a diversified portfolio of 4 ETF's with the goal of long term gains without having to carefully monitor ones portfolio.
At initiation, an equal amount of money would be invested in each ETF, (Horizon Active Floating Rate Bond - for fixed income), (i-shares TSX Dividend Aristocrats for Canadian exposure) (BMO S&P 500 for American exposure), and (BMO MCSI EAFE INDEX) for global exposure. At the end of the year the portfolio would be re-balanced.

For a person who can't carefully monitor his portfolio:
1. Do you consider this to be a viable investment strategy?
2. Do you agree with the ETF choices and if not would you please suggest alternatives in the 4 categories?

As always, thanks so much for your valued suggestions.
Read Answer Asked by Les on January 20, 2015
Q: I was reading your reply to Paul on Jan 19 regarding ZDY, a proxy to US dividend stock, is this considered to be US$ to include in the foreign content in income tax reporting? Is this good to hold in TFSA?

Thank you.
Read Answer Asked by LOUISA on January 20, 2015
Q: Hi Peter, would you be able to shed some light on this Fund? Is it an ETF, a MF? Is there a MER? Would you buy this for exposure to the growth in India? Jeff
Read Answer Asked by Jeff on January 20, 2015
Q: Audrey might consider zqq (bmo NASDAQ 100) and zuh (bmo us healthcare) for the desired exposure. Post if you wish.
Read Answer Asked by Christopher on January 20, 2015
Q: Good Morning 5i,

I am looking to buy ZDY for it's dividend. Usually when I buy stocks I always buy for 5% of my portflolio. Now I want to buy an ETF's how much % of the portfolio do you recommend to buy?

Thanks

Paul
Read Answer Asked by Paul on January 19, 2015
Q: (1) Can you briefly explain what are, and how inverse ETF's work?
(2) Can you suggest a few of the better ones for consideration?
Read Answer Asked by Gail on January 19, 2015
Q: Greetings! Please your opinion of rx. Also I would like your two top ETFs in Canadian dollars for both US healthcare and US technolgy. Thanks again for the help I can count on!
Audrey
Read Answer Asked by audrey on January 19, 2015
Q: Thinking of taking a small position 10,000 US in the German market Is there an ETF that reflects the Dax? Or is there a better way to the German stocks ?
Read Answer Asked by Walt on January 19, 2015
Q: Hello again. Having ascertained that we are working with 10 sectors, I am proceeding with my re-balancing (an exercise I have never done before) and find that Technology is 19 % consisting of CSU,ESL,MDA,SYZ,DSG,DH,ABT,ET and Financial (including REITS) is 22.2% consisting of FSV,HR.UN,HCG,BNS,CXI,REI.UN,ZWB,CSH.UN,ZRE,SLF while Healthcare is only 2.3% CXR. We are septuagenarians, 21 years retired and have about 50 names total obviously too many. Any suggestions on names to eliminate would be welcomed and suggestions for healthcare addition (maybe CCT) also appreciated. We are waiting for portfolio review but I am trying to correct some of these imbalances now. Thanks for the service.

Ted
Read Answer Asked by Ted on January 19, 2015
Q: Hi Peter and team, recently I read an article on Bloomberg BusinessWeek about how India aims to be the next manufacturing super power under the vision of new Prime Minister Narendra Modi. According to the article hourly manufacturing labour cost in China is $3.52 compared with just $0.92 in India. Also the new prime minister is making reforms to streamline the process for global manufactures to set up manufacturing facilities in India. Are you bullish on the India's growth story going forward? Is XID is a good way to get exposure to India's growth? What other ETF s available to get a good exposure to India?
Read Answer Asked by RAJITH on January 19, 2015
Q: An interesting article in the Globe suggesting Indonesia could be rising now like China was in the 80s. Do you have an opinion on this? Can you recommend an ETF for Indonesia? Can you suggest any direct investment ideas? Thank you!
Read Answer Asked by Michael on January 18, 2015
Q: Hi Peter and the 5i Team, What do you think of this ETF for the fixed-income portion of my RRIF? I realize that the yield is a bit on the low side, but so are the management fees at 0.12%. Its chart looks quite impressive. Or do you favour alternative bond ETF's? Thanks in advance.
Read Answer Asked by Jerry on January 16, 2015
Q: Would you explain how ETFs generally work. When I buy an ETF, am I buying someone else's or am I giving money to the provider to buy shares as allocated by the particular index it is tracking?
Likewise when I am selling-is someone buying my units or is the provider selling the composite shares? How is the price determined-NAV or what a buyer is willing to pay? Should liquidity be considered? What are the major factors when considering purchasing an ETF? Thanks
Read Answer Asked by Derek on January 16, 2015
Q: Hello 5i
I noticed that I-shares Canadian Dividend Aristocrat ETF (CDZ) lists a 0.60% management fee and a 0.66% MER. Does this mean the effective cost to the customer is 1.26%? I don't understand the distinction between the two values.
Thanks,Richard
Read Answer Asked by Richard on January 15, 2015
Q: Hix only has $25M in assets. Can you suggest an inverse etf without leverage to protect the value of my holdings in this down market? Thanks
Read Answer Asked by Richard on January 15, 2015
Q: While I am not sure where oil prices will bottom whether that is $30,$20 or even lower, they will bottom at some point. I would like to follow a short list of 4-5 energy producers that are financially sound and have the most potential for a strong rebound when prices strengthen. An alternative is to buy an ETF like XEG or perhaps a fund like Sprott's energy fund. I would appreciate your views and a short list of companies that I could buy for potentially strong gains in the energy sector if and when that happens. Thanks.
Read Answer Asked by John on January 13, 2015
Q: Hi Peter,
What do think of XMU and XUS for U.S. exposure? THANKS.
Read Answer Asked by Terry D. on January 13, 2015
Q: Happy New Year Team 5i. I have no Canadian or US healthcare. I am well diversified with both of your PFs. I do not have any US dollars or direct US equities (only those within your PFs which have US exposure) I am interested in XLV but what would be the best way to purchase? Should I open a US account and buy enough US dollars to purchase XLV and hold within that account or should I just purchase within my TFSA (or RRIF) with my Canadian $. I'm quite naïve about US purchases as you can see. Thank you for all you are doing. It gets easier and better because of all of you!
Read Answer Asked by El-ann on January 13, 2015
Q: I hold this basket of stocks(AVO,BDI,CF,DH,DHX.B,EF,MNW,SJ,TCN,WCP,WSP) in an RSP account. I would like to add 2 stocks to it. I am retired and do not need the money now. The rest of the portfolio is well diversified following 5i recommendations in the model and income portfolios. Can you provide a few suggestions to balance this basket of stocks a little further. Many thanks!
Read Answer Asked by Martin on January 13, 2015