Investment Q&A

Q: I am trying to understand what seems to me as unusual volatility in treasuries recently - especially Monday. Has this sort of thing happened in the past ?

Q: David Rosenberg has recommended a mix split nearly evenly among long-dated US treasuries, high-yield bond and high-paying dividend stocks for investors seeking a favourable return with reduced overall volatility. My questions are:
1) are long-dated US treasuries the same as bonds?
2) how long would you go?
3)could you recommend a long-dated US treasury ETF and a high-yield bond?
thanks

Q: We have held VIG in our RRSP/RRIF accounts for about five years and are happy with the performance. It is now around 7% weighting (I know you are ok with larger ETF weightings vs individual stocks) but I'm thinking of reducing it by about 25% to bolster our underweight fixed income holdings and also to hedge against possible market downturn. My only other fixed income holdings are TLT and a couple of short term GICs. Does this switch make sense and if so what short term bond fund would you recommend if I were to make this move? Thanks for the continuing great service.

Q: Hello, 10% of my portfolio is in bonds equally weighted amongst the three. Should/could I get rid of one? Which would be the best for risk/reward and total return?

Q: Structured notes are a stock/bond hybrid with a limited life span or maturity. When an advisor touts them, they may sound appealing because they often combine high coupon rates with some level of principal protection that would enable their buyer to get their original investment back. Legally, they are unsecured debt obligations of the issuing bank. Unlike most bonds, their coupon payments are often contingent on the performance of an underlying asset such as a stock or index, which means coupons may not always be paid. Structured notes often have no potential to appreciate in price or have an explicit cap on maximum gains.

According to Amy Arnott, a Senior Portfolio Strategist at Morningstar,

“Structured notes may offer big payouts, but those advertised yields aren't always worth the risks. In fact, when we recently dug into some of the academic research on how structured notes have performed, we found that two of the three studies we reviewed found that on average, structured notes have failed to perform better than a balanced portfolio of stocks and bonds, and at times have failed to keep up with risk-free Treasury bills.

Structured notes still account for a tiny fraction of investable assets in the U.S., but they've been gaining in popularity amid recent market volatility and record-low interest rates. They're often described as a way for risk-averse investors to capture additional income while limiting downside volatility. But their embedded costs, complexity, lack of liquidity and transparency, and often unfavorable payoff profiles make them difficult to use in a portfolio. Investors tempted by double-digit yields should therefore tread carefully--or take a pass.”

Can I please get your thoughts and views on structured notes and whether you are in agreement with Amy Arnott’s opinion on structured notes as an investment vehicle? Is this another losing investment opportunity like buying shares in WEED.TO back in the Spring of 2019?

Q: If the unthinkable happens and the US doesn't raise the debt ceiling leading to the US government defaulting, how would this affect holdings in each of HSAV, HSUV.U and ZMMK? Secondly if an investor held both such an opinion and such holdings, would it then be prudent to sell the holdings before the limit is reached? Please define the risks to these holdings if any actually exist.

Q: I keep hearing about the 60/40, 40/60 ratio of what you should be invested in with regards to Stocks and Bonds...

- I have Never held Any Bonds of Any Sort...Just Stocks...

- Please recommend some sort of Bond Investment I can consider that is somewhat safe, but Not ultra conservative...

- I remember when my parents said that Canada Savings Bonds were a good and reliable investment...a vintage memory...

Have a good weekend
Thanks
M

Q: This article appeared on the BNN/Bloomberg website yesterday https://www.bnnbloomberg.ca/td-spots-a-red-flag-not-seen-since-2007-coming-for-the-corporate-bond-market-1.1909735

Can I ask you to please translate it to something understandable? Is it saying regardless of monetary policy that market forces may drive yields higher (and by extension bond prices lower?) If so, this seems to fly in the face of a lot of advice out there that now is a once in a lifetime opportunity to buy bonds?
Thank you.

Q: How would you recommend adding a small/prudent amount of exposure to bonds in the current market environment?

Q: What is your recommended short term CAD bond etf? Can you briefly discuss your top 3?

Q: What is the best high-interest option for keeping an emergency savings fund of living expenses ?

Q: How do you rate this recently launched ETF as a way to invest short term money compared to other alternative such as high interest investment savings accounts or cashable GICs.

Q: Good Day

I hold some in my RRIF and was thinking of adding more as it has held up well through the last year and yields around 6% US$. what percent range do you feel is reasonable for senior loans in a RRIF as a higher risk bond proxy
Thanks for your opinion

Q: Any thoughts on David Rosenberg article in the Globe today? Are we that close to a shift to a a profitable bond market? If so your top two picks. Thank you

Q: To be sure, how is NAV moving up or down for a cash maximizer like HSAV? Why would a premium be given to HSAV? Am I correct in thinking that their performance is closely linked to the 2 year bonds as they have both pretty much the same YTD return. Is one better over the other and if yes, why?

Take as many credits as necessary.

Thank you
Yves

Q: Hi 5i, retiring this year and searching for good div. stocks. Do you have a favorite here with Southern amongst these three? My brokerage company is not helpful with research. I'm looking for fixed rate or long term perpetual, your thoughts are welcome!

Q: I saw this report in the Financial Post
Financial Post
B.C. couple has plenty of money, but even the wealthy need a coherent financial plan
Story by Mary Teresa Bitti • 14h ago

I was interested in this statement in the article:

He has guaranteed investment certificates (GICs), including one that pays out $20,000 a month.

Would you know the details on this GIC?

I would like to know if I could purchase a GIC that pays out monthly, sound interesting?

Could a average person purchase it or is it for high net worth individuals?

Thank you.

Q: Peter,

Is it safe to assume CSU.DB will not be called this year? What is the final date they can make that announcement?

Thank you

Paul

Q: What is your current opinion of high yield US corporate bond ETFs, such as XHY and ZHY. Specifically, do you recommend them in the current economic environment for a relatively conservative income portfolio?
Many Thanks.

Q: Hi Peter,
My question is about Target Maturity Corporate Bond ETFs. Please comments on the advantage and disadvantage of using a ladder of these target maturity bond etfs as a base for the fixed income portion of one’s portfolio. Seems to me instead of buying individual bonds at a discount to take advantage of capital gain upon maturity, the investor can purchase these target maturity bond ETFs to achieve the same goal with more diversification. Is this correct? For investor, is the tax treatment between individual bond and target maturity bond etf the same on an annual basis on the interest income received and on the maturity year when the principal at par is paid out? What should we watch out for when considering this kind of ETFs? What will be your pick for the best target maturity corporate bond ETFs offered in Canada and in the US? Thanks.