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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: Hi Peter,Ryan et al. My daughter age 32 has $32K to invest in her TFSA. My initial thought was a half position in CAO and KXS along with full positions in BNS. ATD.B CTC.A,PBH,
and HCG. Any suggestions and comments would be appreciated for at least a 3 year time frame.
Thanks in advance.
David
Read Answer Asked by David on April 27, 2016
Q: I bought Home Capital before it ran into trouble with some of the lenders. I hung on and then I got a notice about a Dutch auction. How is that different from a company just buying it's own shares on the open market? Do you see a benefit to this auction? I read that Home Capital will soon have insured lending. Could these two events move the stock out of the dump?
Read Answer Asked by Deborah on April 27, 2016
Q: Hello Peter.

I am a income investor with a high concentration in blue chip preferred shares...both reset and perpetual. The later being the larger holding. In theory, when interest rates move the two asset classes...Reset/Perpetual should move in opposite directions. This is not the case. In fact I see them moving in tandem.
I'm looking for an alternative to hedge out my income portfolio. I was thinking an inverse long bond ETF (HTD) might be a good investment to protect my overall balance should there be another rate scare like we saw in January.
Your thoughts?
Read Answer Asked by nicholas on April 26, 2016
Q: Good Morning
I hold 4 Canadian banks CM, TD, RY and BNS in an unregistered account. The bank stocks comprise just under 20% of my portfolio and each has approximately a 50% capital gain. My only other financial stock is a 2.5% position in PWF. Capital gains in my account this year will likely be taxed at 15%. I am considering selling one of the bank stocks (perhaps CM) and investing the proceeds in SLF. I have chosen SLF for it's relatively low valuation and secure dividend.
Is reducing the allocation to Canadian banks appropriate, or does the tax which has to be paid cancel the benefit?
Which bank would you sell?
Is SLF a suitable alternative or is there another company that you would prefer. I already have full positions in CNR and BAM.A.
Thanks
David
Read Answer Asked by David on April 25, 2016
Q: What kind of long term dividend growth would you expect from this company? Can they keep up the historic 8% annually for the next ten years or is this asking too much. Their company presentation claims that they have a naturally higher ROE than other insurers. They do not seem to be aggressive investing their float like Fairfax is. Thanks.
Read Answer Asked by Michael on April 25, 2016
Q: I am concerned about the risk associated with investing in large non Canadian bank stocks. Using Barclays as an example The shareholders’ equity in Barclays is $84bn, sitting on top of $2 trillion of assets. Putting that into perspective, the equity is 4.3pc of the total assets. It doesn’t take much of a movement in the value of those mortgages and loans written all over the world to cause serious problems for those holding the shares. Since the shareholders equity is the difference between two very large numbers the shareholders can easily be wiped out by small movements in asset values. In the case of banks like HSBC (HSBC.US) the exposure to places such as China makes the value of these assets questionable.

Do you agree with the analysis here and does any of this reasoning apply to Canadian or US banks? If so which banks are risky?
Read Answer Asked by Andrew on April 22, 2016
Q: Aegon,a Dutch insurer.
What are your thoughts on this company?
Read Answer Asked by Josh on April 22, 2016
Q: BMO EQUAL WEIGHT US BKS INDEX ETF symbol ZBK. What are your thoughts on this ETF? I currently own this ETF .

Dolores
Read Answer Asked on April 21, 2016
Q: Your subscriber John asked about switching from Manulife to Element
Financial. I own both stocks (MFC 2.1%, EFN 1.8%) and both are down
on the same percentage. Do you think the switching is wise in my
case? If you think it is ok, when is the best timing? In the
Financial sector, I also own HCG-2%, TD & BNS-9% . Thanks
Read Answer Asked by Esther on April 20, 2016
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