Investment Q&A

Q: I'm one of your newer subscribers having joined in Nov '13 and I have been doing much better with my investing since then. I ditched my Financial Adviser/Broker about a year ago when I finally stopped procrastinating and acted upon long held realisation that she was making more money from our accounts than we were.
I now manage both RRSPs and RRIFs for myself and my wife. We own 40 shares in the four accounts, most of them dividend producing, but also some growth stocks and they are fairly widely spread across different sectors and different geographical areas.
I have a few duds, or at least equities or ETFs that I bought at the wrong time when I was out in the wilderness learning to do it all by myself, and I intend to sell them when the time is right to take advantage of your advice given in your answers to members.
It doesn't seem to be too onerous a task at the moment as long as I ignore events like the recent selloff, but are 40 stocks too many?

Q: Since a number of fund managers on BNN have been advocating a significant US equity weighting, do you foresee adding at least some US equities to the model portfolio (or launching a new portfolio)?

Q: In response to a question on Stantec yesterday, you said:
"We still think it is one of the better (top 20) investments in Canada."
What other stocks would you place in that category?

Q: I was looking at your model portfolio. many of those stocks have had a good run. how do I know what a good entry point is on any of them if I were to begin purchasing today? of those stocks listed, which would I consider buying today?

Q: I am wondering about the role of beta in the portfolio stocks. According to my broker's site the beta's for these stocks are: AYA .40, ESL .82, BNS .96. When I overlay the one year charts with the TSX, as expected BNS tracks it closely. ESL and AYA show much better performance with AYA showing a little more volatility. Why would ESL be more similar to BNS?

Q: Hi Peter,
I am wondering if you are planning to do a report on another example of an "F" rated stock.

Q: Great job. My question is to do with share buy backs. What happens to the shares within the company when they do this? Can they not resell them at a future date? Would it not be better to increase the dividend.

Q: Question on Model Portfolio: Total Quarterly Dividend per share by dollar amount?? I could of course add up all the numbers, but wondering if this has already been done and I can find it somewhere on the site? This would be useful for those looking for regular income. Thank you.

Q: Would you please suggest 8-10 stocks to set up a mini diversified conservative growth portfolio that will work in the current economic climate. In addition , please mention a couple of names for some extra giddy up. Thank you so much, Rick

Q: sir
In your Jan Portfolio You have rated stocks A,B,NR etc. I would like to know how these ratings are composed of and how much weight is allocated to each item in your score
Thank you

Q: Hello,

Is it OK to buy odd lot shares, to maintain a certain percentage in portfolio. Are they harder to sell? I have so far tended to buy in multiplies of 100 shares. But sometimes this tends to overweight a certain share in the portfolio because the share price is higher to start with. e.g. The etf "IWO" costs $145 per share therefore this occupies more than 25% of my kids RESP portfolio. Thanks fro your advice. I am learning a lot just looking at the question and answer section each day. cheers, Shyam

Q: This is to follow-up on the question posed by Linda on Jan 9/14 re. tax issues/negative factors to be considered with holding US (or other foreign)dividend paying stocks in a TFSA. Your response was that, yes, in a TFSA witholding tax will be applied on foreign dividends: in an RRSP it will not.
I'm not sure how much weight to give this info when structuring your TFSA. Should it just be -No- TFSA is not the optimal place to hold foreign equity - get your foreign exposure elsewhere. Or - Yes - this is something you should be aware of - it will act as a bit of a drag on returns - but should be subordinate to the over-all objective of your TFSA.
Specifically, I would like to re-structue my TFSA to replicate a mini stand-alone portfolio. And to do so I was considering the Mawer Balanced Fund as a simple one step solution - 40% FI; 20% Can. equity: 40% foreign equity - MER below 1% and consistently outperforms its benchmark.
Question: should the negative tax implications on the 40% foreign component be cause enough not to follow this approach?
Thank-you

Q: Greetings, Team:

I wonder why resource stocks (e.g. Baytex and Crescent Point) tend to go down and are criticized, whereas tech and pharma stocks (e.g. Constellation and Valient) tend to go up when they acquire?

Q: Are any members familiar with the Linde Equity Report which focuses on American stocks? In 2013 it was ranked top financial newsletter - in contrast Jim Cramer's (Mad Money)was 77th. I'd appreciate any feedback members may provide.
Thank you in advance,
Helen

Q: In your response to Graham re Badger you suggested one stock should not exceed 10% of the portfolio. Is that 10% of the equity portion or 10% of the total portfolio including income securities { bonds } and cash? Thank you.

Q: Hi, I originally had 1500 shares of Badger. Sold 500 and paid for my investment. With the 1000, I now have 3000 with the split. It has 'fortunately' given me a heavy weighting with this company. You seem to keep recommending it and I continue to like it even though it does tend to swing my investments when it has good and bad days. My dilemma....at what point does a 'balanced' portfolio outway selling a good stock!

Cheers,
Graham

Q: Hi. I'm a new comer to your service. I love it so far. I have a question regarding your summary list. I am wondering if this is a list of stocks that are okay to buy or, is it the list of the stock universe that you cover and not all of them necessarily represent the best ideas to buy at this time?

Q: I understand that you are not tax professionals and if you can't answer my questions that's ok. I also know it is hard to answer accurately without knowing all my information and details. First question is is interest paid in a margin account tax deductible?

Second question is more complicated. My wife works for Abbott and gets stock options. She pays 2% of her pay and company matches 3% of her pay for a total of 5 percent. Her portion comes off her check and the companies portion shows up on T4 as earnings. When do we pay tax on this? Only when we sale? I understand that we have to claim the dividends as earnings through out the year. To add further confusion Abbott split and now she owns approximately 300 shares of Abbvie and Abbott. How does a split effect taxes?

As I stated this may be complicated and I will take any general answers or advice.

Q: Do you generay favor and recommend dripping a stock or etf?
With 4-5% yield on some stocks or ETFs, dripping can make an impact over a few years

Q: Peter, I wanted to say I agree so much with Pauls question of Feb. 5. I think you are helping a lot of GIC refuges, such as myself.When Gics dropped years ago we slowly stepped into the market with Pembina, IPL, K bro, Cinaplex Rio Can, Keyera. All were paying between 8 and 10 percent dividends at that time. It seemed no one wanted them. Well of course hind sight is 20 20 but as they say the rest is history.. I believe so many of us are looking for the next one of these stocks. They seem very few and far between today. I, like Paul, will not invest in anything that does not pay 5%.Banks, although o.k. have been one of our poorest performers over the years. That is why I think high dividend payers are soooo important. Yes a person takes a hit on the odd one ie. ATP and YELLOW but what we are looking for, I believe is the next K bro or IPL or ect. ect. That is for you to decide. I know it is not as easy now but some gems must still be there. That is what is so valuable to me. Thanks Ken