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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: I have been keeping a lot of money out of the market for most of this year waiting for stability to return. Bonds seemed to be pretty much a pointless investment to me for the last few years but I've reconsidered. Putting a chunk of cash into a bond etf seems better than just leaving it in my account where it earns next to nothing. On the other hand, it's safe where it is. How safe are bond ETFs? I'm particularly thinking of bond ETFs which don't seem to bounce around much like BLV, VLB, and XLB, but which seem to have done well YTD.
Read Answer Asked by John on June 29, 2020
Q: I like the Vanguard family of ETFs and am looking for safe income in these uncertain times. I am aware of VBAL and VGRO, but could you suggest other Vanguard offerings that focus on earning investors relatively safe distributions. If there are other companies that offer superior ETFs for income I would appreciate your suggestions.
Read Answer Asked by Les on June 17, 2020
Q: Dear 5i,

Can I please get your opinion regarding these 3 Canadian Aggregate Bond ETF's.
MKB and HAD have MER's approx. 4 times higher than the passive XBB ETF. It looks like the overall Total Return performance is better with MKB and HAD but, only by about 0.5 to 1%.
1. Do you think it is worth paying the extra fees for MKB and HAD?
2. If yes, which one would you choose between MKB and HAD?
3. With interest rates already very low does it make any sense to purchase any Canadian aggregate bonds?

thanks
Read Answer Asked by Ian on June 17, 2020
Q: Hi, I owned the 5.25% Debentures (and stock) ahead of the COVID-crash, but bought more of both in the pit of the crash. I get that they are servicing a lot of debt, but I also felt that they were perhaps being punished for being an airline, without consideration of their essential service in most of their flying markets, and their largest input cost is fuel, which mitigates some lost revenue.
The Debentures have not recovered nearly as well as the stock. I'm OK holding on to the debentures, as they are less than 2% of my RSP, but would appreciate your perspective.
Read Answer Asked by Darren on June 11, 2020
Q: This fund is recommended by my broker for my RIF/TFSA. Would appreciate your opinion on the pros and cons of investing in this fund. it looks like that this fund provides trailer fee to the broker, would that be an incentive for his recommendation?
The fund may have performed well due to the drastic fall in interest rate. What effect of higher interest rate on the performance of this fund? Do you forecast that interest rate may go higher when the situation of the virus subsides?

Thanks
Read Answer Asked by Saad on June 09, 2020
Q: HI TEAM
XHY IS APPROX 10% AND THE OTHER 3 ARE 30% EACH OF THE BOND PORTION OF MY PORTFOLIO, WHER WOULD YOU ADD FUNDS AS I NEED TO TOP UP MY BONDS
Read Answer Asked by Peter on June 04, 2020
Q: What do you think of this fund? Wanting to put some of my elderly parent's cash in USD. Can you put Canadian dollars into this, or do you need to convert it first (trying to avoid transaction fees)? Also, as I read about it, it seems to have a fair number of Canadian holdings. Does that make sense? Thanks.
Read Answer Asked by Donald on May 20, 2020
Q: Investors seem very nervous about Wells Fargo. Just today (May 14th) someone on this site expressed some trepidation. What’s your opinion about buying Wells Fargo bonds at this time? One is for a three year hold, the other for six years. If Wells merged with another bank, how would that affect those bonds? Some are speculating that Wells could be another Lehman waiting to happen. Does that have any merit? Are their bonds safe? Thanks.
Read Answer Asked by Brian on May 15, 2020
Q: For an individual bond that I hold to maturity, I would consider the yield to maturity as being more relevant than the current yield. But when it comes to a bond etf what is the relevant metric? Possibly the average current yield? As presumably the underlying bonds are not held to maturity as they would be bought and sold to keep the etf's duration in line with its target.
Read Answer Asked by William on May 14, 2020
Q: Hi,
I'm trying to create a well balanced bond fund for that portion of my portfolio and have come up with this: HFR-T, CBO-T, CLF-T, TLT, XBB-T, CVD-T, SHY, FLOT, IVOL, BNDX, VSG-T
I guess I should have something that will generate monthly income as well? If I am overdoing this, please let me know...it seems like a lot of holdings. Is there a better way? A mutual fund?
Thanks.
Read Answer Asked by Gregory on May 13, 2020
Q: Good Morning Peter & team,

Once only thought of as a European/Asia market phenomenon, There is talk we could see negative interest rates in Canada in the next year. Technicals for the big banks are all similar - the beginning of a recovery last week in March as things started turning around then, plateau. Still higher highs and higher lows but not the same recovery as the Markets in general.

I own TD & BNS. I have read your comments on both. Do you feel these are worth holding? Do you think Negative rates could happen? And if so what effect could we expect on the big banks?

Thanks for all you do.

gm
Read Answer Asked by Gord on May 13, 2020
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