Investment Q&A

Q: I found your article regarding the difference between the Fang stocks and a small cap stock index very informative and interesting. Perhaps an even more interesting comparison, at least for me, is the difference in performance between VOO and RSP. One a market weighted US etf and the other an equal weighted. There is quite a large divergence between these two in the past while. VOO has the top five holdings as Fang stocks--over 20% of the total portfolio. RSP has no fang stocks in the top ten.
It has me thinking. But, what conclusion to draw? I have been wanting to move away from individual stocks to etf's, especially in my US holdings. But, this makes me wonder whether I wouldn't be a lot better with individual stocks, say the top ten that you mentionned in response to a question today. In that way I wouldn't be burdened down with a group of non performers, as in RSP, nor too heavily invested in Fang stocks, as in VOO, in the event of a future crash.
I know that it is not too good to change strategies often but I am quite perturbed by this. I don't know if you can offer a comment on this or not. But, I appreciate 5i as a sounding board and any comments you have are always helpful and useful
thanks

Q: this is a link for Ellen who asked about ethical investing. This is a Canadian site but also looks at US stocks:
https://investingforthesoul.com/podcasts/

Q: Could you please explain the following questions in terms easily understood. Price/earnings - what are reasonable numbers/the low and high end and I gather the lower the better - is that correct? Debt to equity ratio - same thing as above but 1.15 - is that $1.15 in debt for every dollar you own? Price to book - what kind of numbers am I looking for there, i.e. if the price is $80.00 and the book is $40.00 - is it 2x book?

Q: Hi,
This question is more curiosity than anything - is there a reason that on May 29th the volume on the TSX actually appears to have exceeded any of the days in March as the markets slid worldwide? I thought that as a market recovers, often the volume decreases as things settle down, so the May 29th spike piqued my curiosity. I use Stockcharts.com and saw this on a daily chart. Thanks for all your hard work educating us!
Dawn

Q: Hello,

My partner and I heard about 5i from a friend whose been using you for many years. You came with the highest recommendation.

I feel like I should be copying one of your portfolios, especially due to my lack of knowledge, but it is very important for me that my investments to follow my ethics.

I would like to know which companies on your balanced and growth portfolios would be highest on positive environmental, social and corporate governance, which are low and should be switched and for which companies. I'm happy to do research, but I'm struggling to navigate the important statistics and feeling incompetent in finding good resources. I have seen your ESG scores (https://www.5iresearch.ca/blog/ESG-tsx-companies) and would be keen to know where to find information on how they are created. I would also appreciate other resources that you think would assist in building a portfolio, or simply which companies you would put on it.

Thank-you,
Ellen Perkins
Ucluelet BC

Q: Is the delisting of Chinese companies on US stock exchanges a real possibility or more noise. How might Alibaba be impacted. Should investors sell and watch or ride it out. The senate bill would require that foreign companies let the Public Companies Accounting Oversight Board oversee the auditing of their financial records. Does Alibaba currently use American accounting methods - GAAP?

Q: If ENGH is expensive as your previous comment then KXS and SHOP must be super expensive. Comments please.

Q: Thank you for your answer to my question of May 28th, about forecast equity returns by geographic region/ country. You provided a link to Star Capital's site, which forecasts the US to have amongst the lowest equity returns globally over the next 15 years.

I would appreciate you advice about this forecast. Do you agree with this forecast? Which regions/countries of the world do you see best to invest in over the next 5-10 years? In Portfolio Analytics, what rates of return are you using for each geographic region/country to forecast the long-term expected return for a portfolio?

The CPPIB is now invested 90% outside of Canada. What are your views for an individual investor? Should individual investors be taking a similar position, and having most of their portfolio invested globally?

Thank you again for your excellent advice, and this wonderful service.

Q: Further to Harrys question on CIPF insurance with brokerage firm. We have 3 acccounts one joint and one in my name and one in spouses name, (1 cash acct, and two TFSA's) Does the one million apply to each account or for all 3 combined.?
I really appreciate your help at all times

Q: Hi 5iTeam,
Suppose I have $250k in each of my RRSP , margin, TFSA, RESP and cash for a total of $1,250k with a brokerage firm. If the firms becomes insolvent, how could CIPF cover my investments? And would CDIC come into play in the aforementioned scenario?
Cheers,

Q: Just trying to understand the short term effect on the market of the 10 million units in the secondary offering. I read that the underwriters committed to selling the shares for $48.85 USD. Does this mean selling in the open market or do they typically have buyers of big blocks lined up to soak up the units? I'm assuming that, if the units are to be sold in the open market, this will put a ceiling on the SP for quite a while since the 20 day avg volume of the US and Canadian markets is about 600,000 units.

Q: If one was to place some stop loss points to various parts of a portfolio,
1. Would you base the number on a moving average and if so what time frame? 100 day moving average?
2. For ETFs?
3. For Canadian equities?
4. For US equities?

Thank you............Ron

Q: When considering weightings of a particular stock do you look at the weight as a percentage of just a stock portfolio, or would you consider it as a percentage of stock portfolio plus defined pension. For example, CSU has grown to 9% of my stock portfolio, but if I include my defined pension it is 3.5%. So if I consider only the stock portfolio then I would consider trimming (to maybe 7%) whereas if I include my pension in my calculations I have no need to trim.

Q: Could you please explain what this means when a stock "does a secondary".
I am thinking that when a company/stock first goes public, they issue a certain amount of shares to raise money. Then, I am thinking that if they "do a secondary" - they issue more shares? So then the value of shares you have are less? Could you talk a bit about this.
Thanks so much for your help
Margaret

Q: Why is this stock so volatile in the $65-72 range

Q: Good Morning,
Thoughts on the proposed name change for Royal Nickel to Karora Resources and the proposed share consolidation of up to 11-1?
thanks

Q: Hello,

I note that REAL is sitting on approx $90M in cash at the current time. Based on its MC, is this considered a lot?

Secondly, is there a point where having excess cash can become a drag on the SP? I picked this up a few months ago based on 5i's recommendation.

Lastly, I bought in at 2% and am now approaching 4%. Let it ride or trim?

Q: Hello 5i,
I don't know if you have any expertise in old stock certificates but I thought I would run this by you just to see. I just opened an old box in an inheritence that we recently received and it looks a bit like someone was dreaming of making it rich: a series of old mining stocks. I have done a quick internet search but have found nothing. I don't know if you know if there is any simple way of dealing with this. They have names like: Atlas Chibougamau Mines Limited, Galloway Chibougamau Mines Limeted, beresford Lake Mines Limited, Conro Devopment Corporation Limited ( another Quebec mine), Laval Quebec Mines Limited,Peninsular Petroleum Limited, Alliance Mining and Securities Limited. As I say, this is not your area but maybe you have some ideas. thanks

Q: Does it matter price-wise if you buy a stock before/after the dividend is paid? Is it the same answer if you buy before/after it goes ex-dividend? I am a long term investor so wondering if there is any significant savings to trying to time the purchase a bit?

Appreciate your insight.

Paul F.

Q: Did people at 5i take a position in Flutter as per your disclosure on the last question? Thx