Investment Q&A

Q: Would you acquire a larger cash position anticipating some bloody quarter 2 results? Quarter 1 results seem to only contain the beginning effects of COVID.

Q: Hi 5i Team,

We've just moved my sprite 87-year old mother's $72,000 from her broker to Questrade. It's a non-registered account and we are trying to make decisions on where to put it with special consideration to taxation.

One option I've discovered is Horizon Corporate Class Funds (a company called Purpose also has them).

It's suite of around 15 funds which include a few different equity types (TSX index, Euro and international stocks, and sectors like financials and energy) a few different bond types, and things like dividend and preferred share funds. As I understand it, one can buy and sell within this suite without triggering a taxable sale.

Beyond that, I don't know much about the tax structure so am turning to you. I wonder if you see this as a good place for this money.

Also curious about your opinion on preferred shares in general. They strike me as a good option for my mother's situation but my financial advisor considers them a thing of the past.

Thanks as always for your wisdom on this site. I'm delighted I bought a subscription.

Kevin

Q: Hi, If one is anticipating another market downturn , could you please suggest some investment ideas in CAD ? Thank you

Q: I really value your knowledge and experience. I would be very interested in your thoughts on the difference between the value of tech stocks today and those of the "dot com" bubble of the late 1990s. Thanks again.

Q: Hi Group appreciate your comments on Gold dropping like a anchor and the strength of Cad dollar I own several gold stocks+ ETfs FSV + GLD appears to be hit the worst. I hold 8% of my portfolio in gold any reason to reduce my exposure. On the currency side what's the outlook for the US dollar seems like its getting hit hard against other major currencies including the Cad $ Thanks

Q: I'm a little concerned about the trade tension, possible 2nd wave of the virus, protesting, economic risk, etc.
Do you think we need to do something in case the market crash?
Currently I hold the above 4 stocks plus 20% cash. Are they safe? Any other stocks that you recommend?
Thanks!

Q: Hi Peter & team
We went from about 95% cash just before the crash to 45% today. We've been expecting a drop to occur from Q2 results and thus are not fully back to where we were before Covid began. But we are also seeing the markets continue to float higher (tech, financials). We'd appreciate any guidance you can offer on the pros and cons of going back in more fully now or waiting 2-4 more months. Do you sense there is still a lot of cash waiting for another quarter to pass?

I read a statement that said, "Wealth is good provided everyone is wealthy". You are decisively helping that advance ...
Many thanks

Q: What sector of the TSX would you invest new money and why?

Q: Hi Peter & 5i,
Which of these 2 ETF's would you prefer and why, or if you have any other that is better, would be much appreciated. Thanks for your wonderful service. Stay safe. Ivan

Q: The Certified Financial Planners’ Guide (https://fpcanada.ca/docs/default-source/standards/2020-pag---english.pdf) provides long-term projected guidelines for Canadian, foreign-developed, and emerging markets (as well as for other assets). Unfortunately, it does not break out the long-term projected guidelines by country, and it lumps the US market with "other foreign-developed markets".

For example, I expect that the long-term growth rates will differ between the US, Japan, EU and UK. Similarly, the growth rates in emerging markets will vary tremendously by country (e.g. China versus Ukraine).

I am looking for more detailed projections to assist in my financial planning. Are you aware of a credible source which provides long-term projected financial guidelines by country, or as a minimum by region?

Also, the Certified Financial Planners' Guide forecasts Canada to have the lowest projected equity returns of the geographic regions. I would like to better understand whether this is a broad-based concensus.

Thank you for this wonderful service.

Q: I own a fair number of the stocks in your portfolios. Given that there may be an upcoming rotation from the hot Tech sector into more value oriented stocks, what are some beaten up value names in your portfolios that you would be comfortable holding a 3% position in? I am still 30% cash and I am trying to wait until second quarter carnage is in and then buy value names. What are your thoughts on this?
Thank You for your support in these times.
Clarence

Q: It looks like there's some mean reversion going on today with some of the tech names that saw big spikes of the last few months. Any names you'd pick up today, or would you wait to see how this shakes out over the next little while?

Q: With the strong positive response to the financial stocks , do you see a possible shift away from tech stocks ie SHOP, KXS, CSU etc. to this sector.

Q: Would you deploy a large amount of cash in the market today if safety of principal was your primary concern...and if so, in what? Are US dollar based investments safer than Canadian or international. Thanks.

Q: Befuddled - that's me. Got a list of stocks I would like to add too or establish new positions in, both in Canada and US.
But do I do it now or just continue to hold off?
After the major market bottom, I thought there would be a technical correct......never happened
Then there was the FOMO...and I took a pass on making stock position buys.
Now, the markets are still moving up, and up.
Now what do I do?....like stay put and wait until after the second quarter results as the there is no end to the covid-19, just changes in phases, at least so far.
What is 5iR's suggested tactic, aka approach???
.........Keen to e-read your take.......Tom

Q: I am starting a new portfolio, totally separate from my existing ones due to different ownership and would likely sell after 3 years. What sectors do you think will have the most positive movement in the next three years?

Q: I'm curious your thoughts about converting to USD at this time.

I typically convert my RSP contributions to USD through Norbert's Gambit and buy US ETFs. With the very low dollar I'm wondering if it would be better to buy a similar hedged etf in CAD and then covert it later when (if) the dollar improves. The Canadian portion of my portfolio is held in my TFSA so everything in my RSP would be better in USD to avoid the withholding tax. I don't plan to access the funds in my RSP for 25 - 30 years. Thanks for your help.

Q: Hi, Covid19, China vs USA trade, Upcoming USA Elections, etc. How do you see the markets behaving to the end of 2020, should We be alert and think about selling/parking some cash for next year?
Thanks 5i.

Q: Hello,with all the recent debt taken on by governments all over the world,this has kind of brought gold into the spotlight as a possible “safe haven” do you think Paul Tudor Jones strong endorsement of bitcoin would be a competitor for investment dollars in that space or am just misreading this
Also do you think with this tremendous amount of government and consumer debt load,do you think gold could be a good investment going forward for at least a possible 1-3 years and maybe even much longer depending on when balance sheets of governments start to look better thanks

Q: Hello,
I was about to question when I should make a significant buy in my kids’ TFSA’s, and should I wait until 2nd and 3rd quarter earnings are out which could substantially affect the market to the downside. Then I read your article: Unintended Investments consequences from Covid crisis. You seem to have answered that very well in that the Central banks of the world have a “put” on the floor of the world’s markets and the worlds’ governments have politically put cash in the hands of those who need it most somewhat enabling the economy.
So in other words, you would suggest to get a move on and start investing before the expensive market becomes more so?
Cheers,
Rick