Investment Q&A

Q: Hi Team,

In my kids RESP (ages 8 and 11) after trimming ESL, ATD, dividends and recent contributions there is enough for another position.
They hold now ATD,ESL,CGX,IPL,MG,BIN,SYZ,DHX,XEG,XFN,XRE,XSU.
Can you suggest another couple of names to consider either for diversification needs or for maybe some US exposure. I was thinking maybe Disney or Apple.
I am guessing we have about 8 more years until the funds are needed.

Thank you,

Brent

Q: For these Vanguard ETFs, which is the better choice (hedged or unhedged)? (We do not travel to the US, and have no need for US funds.)

VFV or VSP
VDU or VEF
VUN or VUS

Thanks.

Q: I am on a huge loss with Teck. it is now one half percent of my holdings. My cost is 28 per share. I do not have much other exposure to mining besides some gold fund. My question is , I would like to book a capital loss but keep some exposure to the sector. Would be FM a good candidate? Or should I be better off to exit the sector altogether?
Thank you.

Q: Hello 5i,
I am planning to strengthen the structure of my portfolio through buying four ETFs, they are iShares Asia 50 ( AIA), iShares MSCI South Africa (EZA), SPDR® EURO STOXX 50 ( FEZ), iShares Latin America 40 (ILF). Each of these ETF will have a 2.5% weighting. Can you recommend a cheaper or better way to get this diversification.
Many thanks,

Q: Hello- is DBC one of those ETFS based on commodity futures which will erode in value even given steady commodity prices, if held for more than a month or two?
Is there another Commodity ETF which you can suggest which can be held for a year or more without this erosion? Does one need to buy a commodity stock based ETF? Any recommendations in Canada and the US?
Thanks

Q: I will likely be retiring within a year, and plan to regularly draw a small amount of income from my investments to supplement my needs. I am slowly transitioning my holdings from a mostly equity oriented portfolio to include a moderate income portion. I am looking for buy and forget type of investments that pay a safe 4% or so dividend with an important caveat – capital protection. I am of the view that a 5-7% dividend has little meaning if you lose 20-40% of the principal investment amount in a short year or two. I understand that with greater safety comes limited upside potential which I am willing to accept. What would be your 5 top picks that best fit this requirement. I am willing to consider whatever investment type you feel is best suited between common shares, preferreds, REITs, income funds and corporate bonds or debentures. I already own T, BNS, AW.UN, BEP.UN, HR.UN, CSU.DB, XHY, CVD, CPD in case you were considering naming any of these so please try to select a few others (from any sector).

Q: Good morning.

I woke up to see that my PBH Convertibles are being called in early along with a whole bunch of other in the past few months.

As a result I have almost 25% of my RRSP's in cash. My RRSP's are currently made up of 80% convertible Debs, PBH, AI, and HXS and MAW150.

Can please make some suggestions re RRSP investments with the idea to maximize return and minimize downside risk. I am open to CV debs, ETF's etc. etc. and any other ideas that are appropriate for a registered plan.

I am over 65.

Thanks very much.

Q: Why has cpd been so volatile lately?
Never been so volatile before.
Is this a good entry point here?

Q: In response to my last question, you named VLS and XLI as possible industrial etfs. Is VLS a typo; having trouble looking it up.
Thanks for your response to that question and this one.

Q: Hello Peter & 5i team,
So far so good in 2015, even though it was a tough year ; the equities (all canadian) I own have generated a 12.6% total return to Nov 20.
But these equities represent 82% of my RRIF portfolio ; this means that I’m sitting on 18% cash which I hesitate to redeploy.
You say that the US economy is pretty strong ; well, I’m not so sure about that. It is rather the best among a lousy bunch; in other words, in the kingdom of the blind, the one-eyed is king.
The S&P 500 rally is of low quality in terms of lack of breadth ; in 2015, its top 10 performing components represent over 100% of the total whereas that ratio was less than 20% in 2014 and slightly more that 10% in 2013. That’s a bad turn of situation.
The relative performance of the Russell 2000 vs the S&P 500 is in decline due to lack of liquidity in the small cap sector (which is the engine of growth). That’s no good either.
The Retail sector (consumer discretionary), which is a very important sector in the US economy, is dominated by only 3 names : Amazon, Netflix and Expedia. That’s hardly reassuring.
The US$ keeps gaining ground ; that causes enormous pressure on Emerging Markets debt and constitutes a substantial headwind on US multinationals profitability.
To top it all, the 2-year US yield is going up contributing to a flattening of the yield curve ; if (and its a big if) this situation perseveres for a few more months, we could face an economic downturn.
This is my rationale as to why I hesitate to redeploy my cash and look forward to your counter arguments,
Thanks as always,
Antoine

Q: Hi
Is there a Canadian small cap fund your team likes?
I tried purchasing the Mawer New Canada Fund, but it's now closed and unavailable to the public.
Any favourites you can suggest?

Thanks

Q: Good morning,

I currently hold SPY, VIG and IWO for US exposure in equal amounts representing 8% of my portfolio. Would you recommend switching to/ or adding to these the specific ETFs that you outlined for tech, consumer discretionary and industrial sectors? Also, what portfolio % might you aim for in US currently.

Thanks.

Q: Seems like the European market may finally be showing some signs of life with stimulus on the way. Can you recommend an ETF preferably on the TSX to play the European recovery? Or do you feel that market is not a good bet right now?

Thanks

Q: Given the .61 MER of XRE I am considering selling it and replacing with three or four REITs. Which would you recommend?
One more question: I no longer own any property so what percentage of the total portfolio would be reasonable for an allocation to the REIT sector?
Thanks as usual.

Q: During your BNN appearance you mentioned tech, industrials and consumer discretionary as the most promising US sectors.
Would you please name your preferred nonhedged ETFS for exposure to each of them?
Thanks.

Q: Hi Peter and Team,

An article in the Financial Post recommended the high-yield bond space. (http://business.financialpost.com/active-investor/high-yield-bonds-a-growing-opportunity)

Do you agree with this thesis, and if so, could you please recommend one or more ETF's?

Thanks as always for the valuable advice.

Q: One of these days the price of uranium is going to bounce back what with all the new global nuclear facilities slowly coming on line. How best to play this ie, individual equity eg CCO or ETF like URA. I have USA funds so can be that or Cdn, thx

Q: Hello Peter/Ryan,

My RIF has one annual payment due mid Dec. I have narrowed the source of funds to either XHY, of which there is a large holding, or MRG.UN which also is a fairly large holding. The overall REIT holdings across five accts is 4.7%. The overall holdings of XHY and other high yield bonds is about 6%. Either choice will still leave a fairly large holding (dollar value) of the selected stock/ETF in the RIF

I am inclined to make the withdrawal from XHY as perhaps MRG.UN will provide a bit better return in the year(s) ahead. Do you agree with selling some XHY or would you recommend I sell some of each?

Separate point: Would it be possible to put the Model and Income portfolio stock listings in alphabetical order for next publication (either by symbol or by name).

Many thanks. Bob

Q: Hi 5i team
I'm looking at adjusting my rrsp holdings
I currently hold
25,000.00 in cig837
255,000.00 in cig686
57,000 in mmf006
39,000.00 in pmo006
I'm thinking that I have to much bond exposure and would like
To move some into vgg eft to get some America company exposure
What are your thoughts
Tks for the input
Sam

Q: Thank you for your earlier answer to my question related to these types of funds! But it leaves me with one follow up! In a tax sheltered environment (RRSP/TSFA) is an ETF focused on preferred shares a good choice for fixed income. From my readings, preferred shares ETF seem to be better suited to an un sheltered portfolio because the 'interest' is treated as a dividend for taxation purposes.

Would I be better off in a tax sheltered environment to purchase bond traded funds such as PSB or XSB? It this is a better option which would you choose? With the prospects of rising interest rates in the USA, would I be wise to mix in some US Corporate bonds as well, such as USB? If this is a better option would a 60/40 split (USB/PSB) be a good split?

Thanks again!!