Investment Q&A

Q: Can you tell me the ownership structure for ESL?
Specifically i would like to know %age of insider ownership.
What is a good source for this type of info for smaller companies such as ESL?
Thanks Shirley

Q: The S&P Dow Jones Indices has just announced additions and deletions to the S&P/TSX Canadian Indices. For example, companies such as SUM has been added while companies such as DH, NFI, STN, WCP have been deleted. What does this mean? Do stock prices rise or fall on such changes?
Would index focussed fund manager purchases or sells also affect prices? Thanks!

Q: Hi Peter,
Wondering why the pipeline stocks in Canada and the US (except for IPL) are going sideways or down, while the rest of the oil and gas sector is doing well. Is it only because of their higher yield, or is there something else?

Q: Hi team, I don't know if this question will provide an answer so I'll give it a shot.
Mortgages- is it wise while rates are low (mine is 3.09 fixed 5 year term ) to put additional money on your mortgage to pay down the principal or would you be inclined to invest it elsewhere for a higher return? My thinking is to pay additional payments on a mortgage while rates are so low. Whats your take?
Cheers

Q: I believe the direction and level of the US 10 year treasury bond yield is frequently used as a portfolio weightings benchmark. I recall the quant/strategist Peter Gibson (formerly CIBC and SCM) used to say he would shift weightings in stocks as this 10 year rate approached 3.75%. (do you know where he woks now by chance?). Stocks still seem to have the heaviest weightings but as treasuries have moved rapidly toward 3%, I was wondering what rate do you think a shift into a heavier fixed income weighting in a balanced portfolio should occur. Thanks for all you great work.

Q: I am in the process on selling my TRP as part of a rebalancing. Do you recommend selling at the market price or the bid? For example I could sell small chunks at market or the total position at the bid. TRP must be widely held but I suppose a market price could be manipulated. How safe is the market price?
When buying do you guys tend to buy at the ask price or at the market?
My father told me he always bought/sold at market as he felt it was better to execute the purchase/sale rather than quibble about the price.
Thanks
Thanks

Q: I don't know if you would be able to answer this question here..

We (myself and wife) have an operating company (software consultany) and a holding company ( transfer any savings and then invest ).

What are the benefits of adding my kids ( who are now around 19 ) as preferred share holders? Is there an article on canadianmoneysaver around this?

Q: Hi Guys,
Great insights!
Would you feel comfortable putting all your money into the model portfolio?

Q: hi team,

What's your view on low vol etf vs. using dividend etfs

Q: I have cash in TD's Premium Money Market Fund yielding .81 % and I am considering putting the money in Ing Direct Savings Account paying 1.35% interest. Are there risks which I am unaware of as the yield difference is considerable. I frequently sell funds to cover stock purchases and the TD money market fund is quite active with money flowing in and out. Thanks, Bill

Q: Hi Peter:

I am looking for an entry point to both ESL and PLB
Should I put in a 1/3 position and wait to see in case there is
a pull back in Sept/Oct to add more to my position ?

thanks!

Q: Dear Peter and Staff,
My husband and I have recently received an inheritance of $200,000. We are concerned about the future purchasing power of our pensions and riff income due to the effects of inflation. Please recommend a portfolio strategy (including stocks) that should give us an ever increasing stream of income at a rate that is greater than that of inflation. Many thanks, I look forward to your answer.

Q: Hi Team ; a question on short selling / long conv debs: How does the seller make money- they are responsible for the dividend on the shares and if the shares go up they get squeezed - if shares go down, they could lose on the deb? thanks

Q: Hi team, May I get your comments on Harry Browne's Permanent Portfolio that divides assets into 25% Gold Bullion (CGL), 25% Cash/Government Short Bonds (ZFS) , 25% Stocks (XIC/VTI/XEF/XEC) and 25% Long Government Bonds (ZFL)? This mix of assets is supposed to protect the investor through the different phases of the economy ie inflation/deflation/recession etc. Does this seem like a reasonable portfolio mix for someone that will retire in 15 years? 25% in gold bullion and 25% in Long Term Bonds seems like this would be a very risky mix going forward.

Q: Re GIB.A: is this an example of noise from sell side analysts?

"Deutsche Bank downgraded CGI Group to Sell saying the company's aggressive accounting has driven much of the reported margin improvement. The firm says CGI's top line growth is weak and lowered its price target for shares to $24 from $32." (Sept.3)

What I don't understand is: why not just say the outlook for the company is poor or shares are overvalued rather than smear the company's accountants? Any thoughts? J.

Q: Peter if you could add 3 extra names to your model portfolio for long term growth with a dividend or without a dividend (value, growth) what would they be at this time?
Tks

Q: Hi Peter & 5i: Just a suggestion and a few comments on tax loss selling and superficial losses. The suggestion is that something like "strategies of tax loss selling" might be a useful portfolio management blog topic.

The comments are these: If you are worried about the superficial loss rule when selling a stock that is down significantly, think hard about what you might want to do. Imagine you have sold the stock and you now have the proceeds in cash. You can take that money and do whatever you want with it. You can invest in any stock within your discount broker's universe. With that kind of potential at your fingertips, does it really make sense to buy back the same stock that you just sold? What would that decision be based on? Is it any different than your thinking if you had not sold it but were coming to the market with new money?

Second, if you are selling something that is down because an entire sector is down and what you are concerned about is not having exposure to the sector (e.g. golds), in many cases you can pick a different stock from the same sector that is down for the same reasons. There are a number of good gold stocks that have all been trashed this year. If gold goes back to $1800, they will all have blistering upsides, not just the one you might be selling to crystallize the loss.

If I try hard enough I can imagine a situation where I might have a strong conviction that an underperforming stock is just about to turn around (within the next four weeks!) and rocket higher. It pretty much has to involve a significant catalyst event that I am evaluating correctly but that almost everyone else is missing. That is an extremely rare circumstance and not one that usually applies to tax loss candidates. One option of course is not to sell the stock. But investors should probably be wary about being guided by an emotional attachment -- of not wanting to part with a stock that has hurt them "just in case it might go up." If "just in case it might go up" isn't a good enough reason to buy a stock in the first place, it probably isn't a good enough reason to buy it back immediately after selling it for a tax loss.

Q: Hi Peter. I am thinking about tax loss selling season which may get underway soon. Could you tell me if the 30 day rule applies if you sell a stock out of your cash account and repurchase it in your RSP or RRIF? Thanks for your help.

Q: Good Afternoon to all
TD Bank issues step-up notes callable every 6 months by issuer. A new issue October 2013 due October 2018 pays from 2.40 to 3.40 over the period. Considering the current low rates and risks of bond ETF'S would you recommend a small purchase 3% of total portfolio in this issue?
Thanks

Q: Re: Superficial loss rule
I hope you haven't previously answered this question. I scrolled back a long way and couldn't find it. If you have then please just ignore the question.
Can one sidestep the 30 loss rule by selling at a loss in one account (say, a direct trading) but buying back within the 30 days in another account (say, RRSP) or does the rule apply to the individual not the particular accounts? Thanks as always,
Neil