Investment Q&A

Q: In July, 2022, when my mortgage is due for renewal (with $90,00 left), say if I refinance for 80% of the value of the condo (about $240,000), would the new mortgage money be tax deductible while still not deducting the carry over amount (about $90,000). In this case $240,000 minus $90,000 would be deductible, with an ongoing ratio of $240,000/$90,000 or 266.67% of every future payment of interest, until the mortgage is paid off.

I realise this is a question for an accountant, but was wondering if you would know?

Q: Got to say...it takes me from one to two hours daily to read over your answers to questions.....WOW, the time to do the answers must be awesome.....And the insights and learnings is more than awesome by 110%.......Many thanks, eh?! ........Tom

Q: In the current environment how much of a cash position would you recommend? I have 15%.

Q: Hi Guys
I have initiated a short position for my portfolio. I know timing the Market is impossible, but at todays lofty valuations i just felt it was warranted.
I have started very small, 1.5% of my Portfolio. My aim is to continue to slowly add to the position over time, maybe every 3 months or so. My thinking is the longer I'm wrong, say over 3 months I'm down 10 % i can lower my average cost base going forward, by adding another 1.5% to the position. Can i have your opinion please, and at what percent would you top out at on this hedge.

Q: I had been thinking about but Tencent for a long time. With the recent bargain basement price, I'm still willing to take a small punt despite the current risk. It's a long term play.

But perhaps I'm too incautious, even for a 'play'. When I tried to buy on Questrade, I got the following message: "You're attempting to buy enter a position in an OTC/PINK sheet listed security. The following risks may limit your ability to sell your position in the future...".

Can you explain what 'OTC/PINK sheet listed security' means. I take this as a serious warning sign but am still tempted to buy under the belief that China would be shooting itself in the foot to undermine the company long-term.

Q: Since the beginning of this year, I can think of 3 companies that were able to list on the TSX with a very limited float of shares available. Examples: DRDR, FDGE, MAGT. Even a few shares can move the share prices quite a bit, both up and down. How is it that the TSX has allowed these limited shares to be accepted and listed there. What are the listing rules generally for these type of cos. Thanks

Q: Just trying to clarify post split prices and dividend numbers on various sites.
For ex., CP was $11.66 on 22Jun2011 and paid a dividend of 0.06 per quarter.
On the 14May21 CP split 5:1 so you got 5 shares for each one you previously held.
Charts, TD webbroker for example, show no change in either the price nor dividend amount pre and post split. So one assumes they have adjusted the pre split prices by dividing by 5 back to the beginning of the chart?
The annual dividend about is now $0.19/qtr or 0.76 annually. If one held CP prior to the split, his total dividend would then be 5 X 0.76 or $3.80 annually?
The dividend value indicated on 22Jun2011 of $0.06 would not need to be adjusted as the dividend per share went from $0.06 to $0.19 over the total period?
Tx.

Q: A reply to James regarding BMO. I have a margin account with BMO with mix of Canadian and US currencies. Dividends are credited in the currency of the issuer, I can settle sale and purchases in either currency of my choice. Nothing ever converted unless I choose to do it. Complete flexibility online. So I wonder if it is familiarity with the online system that is not getting James to do his choice or maybe it is a different rules for registered accounts.

Q: I have held FIH.U for several years now and although it has snapped back nicely from it’s covid low, it is still well below where it was trading 3 years ago and has for the most part been a disappointment. I’m OK hanging on to it but am also considering tendering to the Dutch auction as a good way to exit. If one were to tender their shares, at what price point between the $12.50 - $15 range do you feel would be the sweet spot where you get the highest price yet still have a high likelihood the shares will end up being purchased by the company?

Q: A reply to James regarding BMO. I use BMO Investorline, but don't have a US account. However, in my RRSP account, I bought a US ETF in CAD, but when I sold it, I selected to settle in US dollars and it allowed me to do this. The exchange rate didn't make sense to me and when I called and asked for an explanation it still wasn't convincing. Not the same as what you're dealing with, but I agree that sometimes they don't appear to be very helpful. I've had both good and bad experiences, it almost seems like it depends on who answers the phone. It doesn't make sense that they can't do what you're asking for.

Q: I want to understand the economic and financial impact of the Fed’s tapering it’s bond purchases. Is there a good source(s) that discusses this topic in detail and what the difference in impact compared to raising the Fed’s rate?
I would also appreciate a summary response from you on this.
Thanks.

Q: re: Moez's Jun 29/2021 article on "Canadian Stocks that pay US dividends: Could you confirm your understanding to be that in order to receive in US dollars, the US $ dividend that these Cdn Stocks issue, that the Cdn stocks must be journaled over to an equivalent US$ account (eg Cdn $ TFSA to US$ TFSA, or Cdn $ RRIF to US$ RRIF)? My brokerage says this is what must be done and that they will not charge any currency exchange premium on this). And, if that is done for Cdn stocks held in either a TFSA (US $ )account or a RRIF (US$) account that there will be no US tax withheld on dividends ?
Many thanks in advance for clarifying .

Q: Hello Peter and Team, I’m hoping you (or some of my fellow members) might be able to shed light on a problem I’m having. I set up my self-directed accounts at BMO Investorline to permit both CAD and USD. I recently discovered that despite that, my Canadian holdings that pay their dividends in USD (e.g., Magna) have unilaterally been converted by BMO into CAD (to their profit of course). I have been trying to get an explanation from BMO for six months. Their responses have ranged from ignoring me, to non-answers, to a promised written response that never arrived. Their ‘practice’ seems to be that if I purchased a stock in a particular currency, they will credit the dividends to my account in that currency (converting if necessary) even though I didn’t ask for that to be done and don’t want to pay for such unwanted FX services. As I was unable to find anything in any of my BMO account agreements that dictates this practice, I was told they would point it out and advise me in writing “next week”. That was six weeks ago. I feel I’m being ‘skimmed’ improperly. Any comments? Are others having this problem? Thank you!

Q: I am a subscriber to my 3 grandchildren's RESP accts. What happens when I die. Who can continue to supervise the accounts and make contributions? Thanks

Q: As CSU keeps rising, what would you consider to be a maximum holding before trimming the position?

Q: Recent G&M article suggested that CIBC has initiated CDRs for Amazon and plans other U.S. stocks also; must one open a CIBC account to purchase this product or will it be available through other institutions? (on NEO exchange)

Q: What is your opinion about the new Canadian Depository Receipts (CDR)s being started by CIBC? It sounds like a good opportunity to participate in the American tech boom without paying huge fees to deal in American dollars. Is there any downside that you can see?

Q: On Yahoo finance today at 11:32 adt, it show a volume spike of 52.9K. On the TSX site under "Trading History" for the same time, there is no indication of that many shares being traded, not even close. On my Questrade "Time and Sales" it's not there either. I thought volume on bar charts where actual traded shares, if this is not the case, is what I'm seeing on Yahoo the level of Ask and Buys, but not actual trades? Thanks,

Q: Hi Peter,
CIBC launches depository receipts for shares in US companies. The first to launch was amazon.com CDR NEO: AMZN-NE on the NEO exchange.
The shares are hedged to the Cdn dollar.
For Amazon with a cost per share of $3,622 US the cost per share on the NEO is 22.86 Cdn.
CIBC will be launching more of CDRs for more US companies in the next days. What is your take on this method of buying into US companies without spending a lot of US dollars?
Thanks
Ron

Q: Me, want to share this zinger that made me chuckle like hahaaaa.....BNN attributes it to Lorne Steinberg​ that I understand is a "value portfolio manager"
here is Lorne's "elbow" at investment analysts - If investment analysts were meteorologists, rain would never be in the forecast.​