Investment Q&A

Q: Hello. My portfolio is currently composed of all equities and approximately 10% cash. I would like to move some money 15-20% out of equities into fixed income. What would you suggest is a simple, yet effective way to achieve this? Invest directly into bonds? Buy a bond ETF? Bond mutual fund? Short or long-term bonds? Corporate or government? Can you suggest some bond ETFs or mutual funds?
Thank-you.

Q: Hi, Just to clarify further about the debentures - If Constellation decides to redeem the debentures, Only the Warrant holders will have the ability to buy the new debentures and in the ratio of 1 warrant providing a right to by 1 debenture. So, the Debenture holders ( with redemption called ), can only swap/buy the new debentures with No Redemption clause, would need to either already have or buy the warrants in the market. If not, they will be exposed to a capital loss of, say. $37, for each debenture.

In our situation, we have currently 500 CSU.DB debentures and only 250 warrants. So, in a Redemption call scenario, we should be prepared to Buy 250 additional warrants in the market, if we want to swap/buy to retain the same no. of 500 debentures ownership. Is this correct ? And, for this reason, there could be a huge demand for these warrants, when called for redemption, because, a large no. of debenture holders, may not necessarily already have those warrants.

Will the New Debentures be listed as a separate security, in addition to the existing debentures CSU.DB ?

Thank You

Q: Now that I discovered that RBC has opened its direct investing accounts to high interest saving ETFs, I am interested in moving the cash portion of my portfolio. HSAV is interesting because of the capital gains tax advantage. However I noticed that it has been fairly volatile in the last few weeks - swinging by almost 1% in a single day. That is more volatility than I would’ve expected from an investment that primarily holds bank savings accounts that reprice daily. Is there something else going on here?

Q: Hello, Based on 0.33 CSU.RT, purchase and cost of 3.03 rights being 0.33x3.03= $0.99. We can acquire new CSU debentures at a total cost of $133+0.99=$134 appx ( FV $100 and Debentures with no right with management to redeem ). Does it sound accurate ?

Questions:

1. CSU debentures ( existing ) are currently trading at $137. What do you expect the trading range of New Debentures, which will be listed after Oct 6 ? My assumption is that new debentures could trade at a higher price than $137, due to No Management redemption right ( All other terms, interest etc being identical to present debentures ).

2. These debentures will pay interest based on 6.5% + 0r - Rate of change of CPI, over preceding 12 months, as at Mar 31, each year. Looking at the present and projected inflation scenario, if the rate of increase of CPI, declines over time, compared to current high rate, the annual interest rate for debentures could see a decline. Would this not cause the Debenture ( like other Bonds ) market value/price to decline ?

Please correct these assumptions and provide your thoughts. Thank You

Q: A question about this savings product came up the other day. When I search, it shows as trading on "CHI"; what is that exchange? Is the fund itself CDIC insured and if not, are its holdings? Will the yield fluctuate every month? Any other info you can provide will be appreciated. Thanks

Q: Hi there,

With so many low risk, high yielding ETFs now that are producing better rates than savings accounts, which would be the best to hold in a non registered account, and why?

Thanks!

Q: Would you go for an RBC one year prime linked GIC at 4.75% redeemable with interest after 30 days. or an HSBC standard one year GIC at 5.25% redeemable after 90 days with interest? I suppose it's a call on where you see interest rates heading.

Q: Hello 5i,

GIC's are about 15% of our portfolio with BTI and EPD each at 1.5%. GIC's (laddered strategy) roll over between October and March. Would you recommend 1 or 2 year GIC's (@5.5%), 5-year GIC @5%, add to EPD or BTI , or do you recommend a bond or mix of bonds? We are in our mid 60's, retired, risk tolerance is medium.

Thank you for your Service
D&J

Q: After reading the questions and answers about the new offering csu has made to share holders. I am still a little confused. Do I have an option to buy? Are they shares? How much will they be? Should I buy them? Will I be able to sell them? Why are they being offered? Thanks I really appreciate your insight
Stephen

Q: Your opinion on WTS-constellation 31MAR40. Thank you. Fooklin

Q: Hi There, I have some USD funds, non-registered USD account. Can you please me give a few ideas to park in a high interest, tax efficient investment for a 2-3 months?

Thanks!

Q: How risky is HYG?

thanks

Q: If you have been this today do not bother answering this question. The rights issued by CSU as a special dividend. Why is CSU bothering with financial engineering rather than just running the company. This appears to be a wasteful cost and use of company brain power for no fundamental gain.

Q: I'm looking to park some cash and let it earn some interest. My bank doesn't offer any meaningful savings interest rate and I'm not interested in a GIC. Can you please recommend a couple of money market funds or ETFs I could buy through my non-registered iTrade account.

Q: Hello there

I'm looking for a US bond fund (USD is fine) for a registered account. I'm fine with high quality corporate bond funds or gov't whichever you consider optimal. Which do you suggest are worth considering? thanks al

Q: Good morning,

I know this might be an odd question, but hear me out.

What are your thoughts on taking a more dynamic approach with one's cash allocation in a portfolio to enhance yield? I know there are tax and trading cost implications with the following, but aside from these, what are your views on moving cash towards the end of each month, prior to the ex-dividend date, to a covered call fun like HHL, and then sell just after the ex-dividend date and keep in cash until the end of the next month. A fund like HHL appears to have "some" price volatility (of course), but also a yield approaching ~ 9%. It seems that by taking a more active approach to one's cash, and moving it in/out of HHL monthly to coincide with monthly cash distributions, might make some sense. So long of course as you are prepared for the fact that there is ample scope for capital gains/losses that you would otherwise not have if you were to hold just a GIC at ~ 5%.

Q: What bond funds are the best to invest in right now for the long term? Currently I hold ZAG.TO and CVD.TO. Should I continue buying them? I would prefer a higher dividend than what the ZAG gives.
Thank you!

Q: Hi- retired investor.
Bought these a while back for fixed income and am down 8% and 10% respectively. Could you explain why these have decreased while bond yields have increased?
Should I dump these and just convert to a 5% GIC or is there a light in view?
Thanks
Jeff

Q: Could you give me some examples of the "Fat Coupon Bonds" that David Roseberg" referred to on BNN yesterday?
Could MTF be included? Thanks, JAMES

Q: I am currently holding over $80K in ZMMK as a holding place. Approx. 4.92% dividend while I wait to see where this market is going (so many mixed signals and differing opinions !). RBC just announced they are supporting the purchase of things like CASH, PSA, etc. How does ZMMK compare compare to the Horizons High Interest Savings ETF (CASH) ? Is ZMMK as "safe" ?