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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: What is your suggestion for bonds or a bond fund in this market climate? Thanks
Read Answer Asked by Gary on April 25, 2022
Q: All my fixed income is in XCB,XRB and VAB. All are held in tax sheltered RSPs and distributions are in DRIP programs. My question is " would you continue with the DRIP programs as I have to start withdrawals in 5 years when I turn 71? " These bond ETFs are all in serious down trends.
Read Answer Asked by Ronald on April 22, 2022
Q: Hi,
Would you be reluctant to maintain more than $100K invested in a Canadian financial institution because of the cap on CDIC insurance?

I recently transferred a bunch of dough to Tangerine as its HISA is paying 2%.

I'm not concerned but should I be?

Thanks,
Robert
Read Answer Asked by Robert on April 14, 2022
Q: Hello Team.. As interest rates climb my strategy is to slowly buy into bond funds (now in cash).. maybe ZAG or XSH. For example at 3.48 % for ZAG, that's a reasonable dividend and the rate hikes have barely begun. My question is -although the unit price of the fund will decrease "is the payout stable or increasing" as maturing bonds are replaced at higher yields.Steady buying at lower unit prices (and higher dividend)could help kill the pain of the early buying-what do you think.( 71 year old income investor soon to be starting RIF withdrawals) Thank you yet again..best regards Gary
Read Answer Asked by Gary on April 12, 2022
Q: For investors seeking to capitalize directly on what looks to be an impending rate hike bonanza through the end of this year (and possibly into 2023), what options are there to look at?

TTT (US) seems like the only decent option but it only offers exposure to longer term rates (20y) which could take a while to respond to higher rates on the short end. Any options you can provide me to investigate are greatly appreciated. Thanks.
Read Answer Asked by Marco on April 06, 2022
Q: Between January and March of last year (13-16 months ago) I sold my bond holdings in ZAG and CLF and moved the money into the short-term bond fund ZST. As a capital preservation strategy it limited the downside from rising interest rates. ZST is down 2%, while CLF is down 6% and ZAG 9%. I saw an analyst on BNN this morning recommend it is time to start easing back into longer term bonds. It feels a bit early to me. Won't the short term bond funds benefit first from rising rates while the longer term funds will continue to decline? If capital preservation and rate of return are weighted about 50/50, what do you think of moving back into longer term bond funds at this time and would you do it gradually?
Read Answer Asked by Ken on April 06, 2022
Q: Hi 5i
Due to unfortunate domestic circumstances my son has just had to sell his house. His net share after the dust clears is $80,000. He has signed a lease on a rental for one year, but plans to buy a new place of his own after the year is up. He has a good job, and all his expenses for the year ahead will be taken care of by salary. His intent is to use the 80k and whatever growth / income it can generate over the coming year to put down on a new home.
My thought is he should put half into BNS and half into ENB and then forget about it for the year and let the money do some work.
But I'd really like to know, based on the facts above, what you would do if you were in his shoes?
Thanks 5i - I will value your response. $75,500 of the $80k could go into a TFSA - he has that room.
Peter
Read Answer Asked by Peter on April 04, 2022
Q: The general rise in interest rates continued during the first quarter of 2022, continuing its pressure on the price of fixed income securities.
I would like to have your opinion.
Is it a good idea to buy fixed income indices right now like the Canadian Bond Index or the Canadian Real Return Bond Index or the High Yield Bond Index? What kind of return can we expect?

Read Answer Asked by Serge on March 31, 2022
Q: Hello,

From your last report update of March 9th the 5i Balanced portfolio is down YTD -7.18%. Mawer's Balanced fund Series A is also down YTD -7.15% as of March 30th (according to Morningstar data). I find the comparison between the 5i balanced portfolio and the Mawer Balanced fund interesting because the Mawer fund has a Canadian bond weighting of ~30%. Given the current market back drop shouldn't balanced funds with a sizable bond weighting provide better down side protection? Or is this mainly due to rising interest rates affecting bond performance?

Thank you,

Glen
Read Answer Asked by glen on March 31, 2022
Q: I have owned a few perpetual preferreds for quite a few years. Now that interest rates are going up, some of them (particularly the ones with Canadian Utilities) have been declining. I should have sold them earlier this year but did not. What do you think perpetual preferreds will do in the coming year?
Read Answer Asked by Maria on March 30, 2022
Q: I have $ 300 K US to invest . Can you suggest safe investments that would be covered by CDIC. My time frame is 1-3 years. Thanks
Read Answer Asked by Ronald on March 30, 2022
Q: I have about half of my balanced income portfolio in equities and the remainder in cash. Although my stocks are balanced, I still hold no fixed income investments. I like the sleep at night cash but feel it is too big of a chunk to just let sit in cash., Can you please suggest an approach to fixed income and recommend a few possibilities to consider. As always, thanks for your help
Read Answer Asked by Robert on March 29, 2022
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