Investment Q&A

Q: Good day
My daughter(45 years old and married with 2 young children) has recently received an unexpected gift equating to about 1/3 of her current investments in mutual funds.She plans to invest these new funds in equities/fixed income in a registered plan. Considering the current market situation, what would you suggest for a balanced investment at this time or should she wait for some stability to return to the market?

Q: Please provide your thoughts on two funds in the precious metals sector.
1. Sentry Precious Metals Growth Fund
2. Precious Metals and Mining Trust

Are either worth keeping and are there EFT's that you would recommend instead?

Q: Is this fund affected by the falling Canadian dollar?

Thanks
Dolores

Q: Hi team, a quick comment first: For some new investors out there I have been through many corrections since going it alone without a broker. Just hold tight, collect dividends, DRIP what you can, good companies will survive. My question is that I have some cash on hand and I am giving some serious looks at buying some HEX for the dividend, maybe in a week or so. Time to buy when everyone else is selling, thoughts? Thanks.

Q: Hello,
If I buy an ETF such as XIU now, in the latter part of 2014,
I will get only the December dividend payment. Will I, however get a 2014 tax slip showing all the distributions for the entire year?
If so, at what date in December do I have to sell the ETF to avoid getting this tax slip?
Do these rules also hold true for ETFs held in the US such as EWU or VGK?
Thanks for your help.

Q: Good morning everybody at 5i .I am fully invested in the model portfolio and would like to use ETFs to invest outside of Canada.what market conditions would allow you to buy into the Russell 2000 ,S&p 500,Europe and Asia.everybody excepting the North American pullback but not so positive on Europe or Asia.thank you for your response and enjoy your Thanksgiving long weekend.

Q: I have primarily a Canadian investment portfolio (with large caps and many of the 5i stocks) but have some money in a US dollar account that needs to be invested. Is there a US sector or stock(s) that you would suggest for investment? Thanks!

Q: what is your view between CBO and VSC.Any preference?
I see you have CVD in income portfolio,why? Have 160K to allocate to fix income in my RRSP.loOking at CBO,VSC (REAL SHORT TERM),CVD,XHY.
US industrial really taking a hit!Just a correction?UTX,FLR,PCP,BA.

Q: Hello,
Just wondering of your thoughts on an investment in Europe and Emerging Markets/Asia and what %'s in a aggressive portfolio. Thanks Again!

Q: Hi team:
I owned XTR for a few years in my RRSP, it generates about 5% yield per month but compared to FIE, another ETF, it has underperformed, the later has alot of Cdn Banks in it, probably accounting for the better performances; as the interest rate might edged up slowly, it could put a negative return on XTR as it has more bonds and preferred shares in its holdings, as an investor in his early 60s, I wonder if I should switch XTR (about 50%) to FIE due to the impending interest rate increase which they have been talking for the last 3 years ? Thanks! have a good day and looking forward to hear from you

Q: Hello Peter and team,

I am looking to get some exposure to the US market via an ETF in a non-registered account. My criteria is that the ETF must pay a dividend and have some growth potential; this is for a 3+ year hold, medium risk investor. Searching through the Q&As it looks like your favourite US ETFs would be SPY, IWO and VIG. Based on the current market environment which is your favourite ETF that will meet my criteria today?

Can you remind me about the withholding tax issue? Is it worth the hassle of the withholding tax, or is it better to get a Canadian $ hedged ETF instead (and which one)?

If I buy before the end of the year, will I get a large taxable distribution (e.g. IWO in Dec 2012)? Is it better to wait until January to buy? Many years ago I bought a mutual fund in a non-registered account in November, and got stung by a large tax bill when they paid out the distribution in December even though I was not in the mutual fund for most of the year. I don’t want to repeat that, and I am not sure if ETFs work that way as well.


Paul J.

Q: Peter and team:
What do you think of xlk as a broad brush play on the technology sector? Is there a Canadian equivalent? (either Canadian companies or American companies in can. funds). Could you briefly touch on how etf's are handled vs. pure stocks @ tax time?

Thanks for such a great service!

Phil

Q: Hi, I noticed that you recommended a Vanguard Canadian index ETF called VCE in your answer to another questions. Vanguard also has one called VCN which seems to cover Canadian large, medium and small cap. Which one do you think is better and why? I already own many of the stocks in your portfolio and am just looking to add diversification.

Q: Good morning 5i, in April you liked the high yield sector; has your opinion changed or is this still a hold. Thank you

Q: Hello
I recently sold ZWB at $17.85 and now planning to buy CEW (equal weight banks and insurance companies ETF) Is this ok or would you suggest a better alternative.

Thanks

Q: Hello
I recently read the following,
Warren Buffet flatly endorsed a simple portfolio of inexpensive index funds for his own survivors. My advice to the trustee couldn't be more simple: Put 10% of the cash in short-term government bonds and 90% in a very low-cost S&P 500 index fund. (I suggest Vanguard's.) I believe the trust's long-term results from this policy will be superior to those attained by most investors — whether pension funds, institutions or individuals — who employ high-fee managers.

If a Canadian was to follow this advice, and allocate some to a Canadian index fund, a U.S index fund and short term government bonds. What would your allocations be and what Canadian Index fund would you recommend? If you where to periodically rebalance the portfolio how often would you do that. Would you use this strategy in RRSPs, TFSAs and RESPs?
Also should the investor protect him/herself from U.S dollar currency risk?
Use the assumption that this is for long term investing.

thanks, looking forward to your comments.
Bryon

Q: Hi folks: Would buying HIX (TSX 60 inverse ETF) be a good hedge against a market sell off at this time?

Q: Further to the general talk of a market correction, would it be prudent to sell the ETF positions in the Income Portfolio and hold cash for a few months, to see if a correction takes hold?

Q: If/when interest rates rise, should one be getting out of this ETF?

Please forgive the naivety of this question, but I hear analysts blathering on at great length about the need to "get out" of bonds as the economy improves and it leaves me at a loss on how to deal with this in my portfolio.

I realize this is in your Income portfolio for its attractive yield, but was wondering if the forecasted interest rate rise does indeed begin soon, does the thesis of holding this for its yield still remain valid? Would not the falling market price then negate its dividend yield?

Q: Hi Peter, I have some US funds I would like to use in the healthcare sector (no exposure at this time). Could you give me your take on Walgreens WAG, IBB and IYH. Which one would give me the best long term hold?
Thanks
Gary