Investment Q&A

Q: GOOG is now about 10% of my holdings excluding the fixed portion of my total portfolio. At what % would you let this one run before scaling back? In previous response to members you indicated an 8% start make you nervous but, this is GOOG a member of the trillion company.
Thanks.

Q: You recently responded to a question regarding Lightspeed: "We don't typically get scared off by stock strength, and that would be the case today. We might do a partial position as it is not going to be a one way up move for this stock."

My question is: Given your theoretical perspective of NOT averaging down, what would be the point of buying an initial partial position? It seems to me that you may as well just purchase your whole position right at the start rather than holding back for a later purchase (always at a higher price, because you don't average down).

Am I missing something? Could you elaborate and clarify please.

Q: I understand that there are tax advantages to holding different types of equities in your TFSA, RRSP and open accounts. I would appreciate some information on the preferred types of equities to be held in the various accounts – US stocks, Canadian stocks, International stocks, dividend paying stocks, non-dividend paying stocks, ETFs, etc. Thank you for your information.

Q: I need to get access to a data base such as Compustat in order to back test an investment thesis. I have been able to get data (EBITDA, Revenue from operations, Good Will, Total Assets) for 2018 and 2019. I would like to access data back to 1998 for all NYSE and NASDAQ companies.
Results for 2019 are 57.37% and 2020 YTD22.46 %.
Happy to discuss system with you if you are interested.
Any suggestions on accessing a database?

Q: Can you please give your opinion on the below Options ratio?
Is that means bullish or bearish for stocks

https://www.alphaquery.com/stock/TSLA/volatility-option-statistics/120-day/put-call-ratio-oi

Thanks for the great service
Hector

Q: Can you please explain what Bitcoin and the crypto industry is all about. How can Bitcoin be worth $20,000.00????

Will this move to Digital currency make our portfolios as we know them now worthless?

Any insight you can provide on this topic would be greatly appreciated.

Q: How can I ascertain from the average Morningstar/others report if a fund is Leveraged ,2x,3x or not at all. for example BLK????
Art

Q: I have access to Morningstar through the broker. Morningstar’s analysis is often useful, but its ratings of companies covered are puzzling. Nuts, actually. A business starts doing better than ever and its shares rise as investors come to appreciate the rising value. Just at that moment, in comes Morningstar with its downgrades. It beats up a company performing very well by downgrading the rating of companies whose results are improving to Hold or Sell. Conversely when a business is stumbling badly and its shares drop, up goes the rating from Morningstar. One understands when analysts downgrade and explain that they still like the company but that they feel they need to go from Buy to Hold on the grounds of valuation . I have not seen Morningstar explain their ratings in a similar manner. If one reads Morningstar’s narrative, is it best to ignore its ratings? This is after all what one tends to with “target prices”. Or, am I missing something important?

Q: I have been investing for a long time, and have always looked carefully at the p/e ratios and other valuation metrics of stocks that I have bought. I've always felt that the valuation of a stock matters. I read 20 or 30 years ago that the ultimate value any stock holds is the long term ability to generate profits and return these to shareholders in the form of dividends. Lately, it seems that a lot of that is being ignored. There are so many well owned, highly regarded stocks that aren't even profitable on a GAAP basis, and p/e ratios are non-existent in many cases because the company is losing money. I like growth stocks, but it just seems to me that there needs to be some kind of reasonable valuation factored in as well. Many of these high flying tech stocks are now trading at multiples of sales instead of non-existent earnings, and many of those at 20, 30 or more times sales. I know that you like a lot of these, so no need to specify any particular stock. I can see that these companies are growing revenues rapidly, but it can't be as simple as that can it? The revenue is going up 40% or 50% or more a year, and it's a good business, without a ton of debt, so it's a buy? Isn't there some kind of limit? Not trying to be critical - I own some of these high priced tech stocks myself. Some of them, I just can't get my head around what looks like astronomical valuations. Thank you for any comments or insight.

Q: Good Morning
Do we get the dividend tax credit from Canadian stocks listed in the New York stock exchange?
Thanks.

Q: I tend to buy on noticeable dips. The momentum crowd often seems to do well so I am curious: are you aware of any study that compares performance between the following approaches:
Buy stocks at or close to 52-week highs, vs.
Buy stocks at or close to 52-week lows.

I have tried to do this analysis myself using commonly available “practice accounts”. My what-if scenarios however lack the rigor that you would see in an academic exercise. Also, a question related to the above: when one is reviewing stock charts available at the better sites, are dividends included in the charts that compare baskets of stocks? I have assumed they would be excluded. If my assumption is correct, does that distort performance comparisons in a significant enough manner as to nullify one’s conclusions?

Q: This is not a question, but a comment. Many years ago I read "One Up on Wall Street" by Peter Lynch. My main takeaway was to look around me. As a shopper I hate Loblaws since there are always bare shelves and they seldom have what I want. If there is a special, they are sold out within hours on the first day. This has gone on for many years. In contrast, Metro always has what I want and sometimes more. Therefore I own Metro and have done well by it.

Q: Hi Peter and Team
Your advice on options, specifically covered calls is very much appreciated. Some time ago you had advised on opportunities in the US market for selling covered calls. As I believe that with the US election done that there may be some return to normal, is this a good time to again consider selling calls and could you advise 3 Canadian and 3 US shares that might offer good premiums ?
Thanks so much for the ongoing advice. Peter

Q: Good morning
there has been several questions at various times regarding parking money for short periods example 3 months or less
most times you suggest GICs or PSA or high interest accounts
would a short term money market fund be appropriate and if so can you suggest some with liquidity on a daily basis
What are the risks of such funds
the intent is to have this money available for purchasing stocks at short notice
If not any other ideas would be welcome
Thanks

Q: I understand that you are generally not in favour of averaging down.
How do you feel about averaging up ?
I am interested in any conflicting similarities of reasoning.

Many Thanks

Q: I own a number of Canadian dividend paying companies (ENB, TD, BCE, CNR, CM, SLF) in a taxable account. Is there a downside to "journaling" these stocks to the US side in order to be paid these dividends in US dollars? It would allow me to reinvest in other US listed companies without having to exchange money.

Q: Hello
I have noticed this with other companies but in the VEEV profile, under Share Information it shows Institutional Holdings at 152.7%. I'm guessing this is due to short positions or Stock options but would appreciate clarification.

Thanks, Greg

Q: I was wondering if a managed portfolio account with one of the "wealth management" departments at a large Canadian bank (RBC, BMO etc.) is charged transactional fees for securities buys and sells in addition to the quarterly % fee?
In other words, if a stock is purchased in such an account is there a "hidden fee" added to the ACB (adjusted cost base) for the transaction?
I've noticed that on the monthly statements the "unit price" for purchasing a Canadian equity usually has 3 decimal points for the unit cost. That leads me to believe that they are including a fee in the unit price which distorts the unit cost. Am I wrong?

Q: Dear 5i
Between my wife and i , we have 3 RRSP and 2 TFSA accounts and 1 unregistered account .
In terms of stock picking for each account how would you go about choosing your stocks based on having 6 different accounts ?
For example i`d like to own 1-2 utility stocks per account and maybe 1 bank stock per account . Would you say that i`d be better picking a different bank / utility stock for each account OR just pick the 1 or 2 of the best stocks per category and have the same "best " stocks in each account ?
Thanks
Bill C

Q: Are you able to provide a 5i model portfolio for US equities only?