Investment Q&A

Q: I have been an investor in small and midcap stocks for over 20 years with a willingness to accept additional risk in my portfolio.I am now transitioning my portfolio to a more Income focus, as i will need dividends to supplement my retirement.
Questions i have are about construction of income portfolio?
Do you feel it is still important to diversify in other countries and regions outside of Canada?You would lose some of the favourable tax benefits!

In trying to classify many dividend stocks in sectors i find that they cross the line into numerous sectors,(example many pipeline stocks are said to be oil and gas stocks, many are said to be utility type of investments)
What sector do you put an ETf in?Seems like a lot of investors drive themselves crazy in the allocation to sectors

I have looked at your income portfolio and your fixed income portion that is addressed by a few Etf.I have taken positions in individual preferred shares,debentures, a couple of instruments with bond like qualities.What is the percentage you would advocate for fixed income or there proxies?

Many Blue chip income stocks pay quarterly dividends,when i prefer monthly dividends.This again can skew my portfolio so that diversifying by sector and country becomes difficult

I find that the construction of my Income portfolio has given me many grey hairs(which i dont need help with"thank you very much")

Q: Do you think it wise to sell all securities until this US Korea problem gets fixed one way or the other. If hostilities do break out I imagine the world stock exchanges are going to break down.

Thank You
Craig

Q: I am a trader by obligation rather than by choice as I spend an important part of my time trading micro caps.
For obvious reasons these companies mostly have little or none revenues, expectations is all what is left.
However, there is another way of being sensitive to the balance sheet is expenses, and i am particularly sensitive to burn rates because that may be a key to future share offering with or without the dreaded warrant.
I just read this document: http://avc.com/2017/09/some-thoughts-on-burn-rates/?utm_source=Daily+AR&utm_campaign=871270e2bd-RSS_EMAIL_CAMPAIGN&utm_medium=email&utm_term=0_c08a59015d-871270e2bd-140326233
Would you give me your opinion on its value for future reference.
Thanks
CDJ

Q: Please explain the significant price differential between Canadian gas and oil wholesale prices to their US counter parts. How does the economics work for CDN companies with such a low price??
Thank you

Q: If you had two or three hundred thousand dollars (not in an RRSP or TFSA), and you wanted to grow it aggressively for a period of about three to five years, how would you invest it, and what kind of a return would you expect? Would your answer be different if it was only fifty thousand? Assume that I don't need any income from the investment, that I have maximal tolerance for risk, and that I've already tried tulips but I was 380 years too late. Thanks.

Q: A different question. As an active retail investor I often get advice to start trading options. Others claim that trading options often leads to losing money. What is your opinion on trading options for various purposes? Thank you.

Q: Re: Chinese stocks U.S. listed such as MOMO, TAL and others, were they formed via Reverse Takeover? would this be a concern??

Q: According to the experts in seasonal investing, September is statistically the worst time for markets, but then things start to pick up again later in October and into November. Would you let this consideration influence your investment decisions? I have capital to deploy but I'm wondering if I should wait another month or so before I start new positions. Also, are foreign markets (Europe, EM, Japan, etc) subject to the same September curse, on average? Thanks very much.

Q: How will the Hurricanes in the Southern USA affect the markets?
Canadian and USA ?

Q: Hello Team,
I am 71, invest in value blue chips and ETF's 30% fixed, 20% cash, 50% equities. The portfolio is balanced following your portfolio review advice, including part of the income portfolio and part of the ETF portfolio. In our TFSA we have a 5 year GIC ladder with Oaken and some fixed ETF's. For 2018 TFSA ($4500 each)should we go with a growth stock, continue with the GIC plan or extend a fixed ETF? We have a little growth stock as per your income portfolio.
Thank you
Stanley

Q: My question pertains to market history. Could you comment on market activity during times of major conflicts. For example were the markets operating on a "business as usual" mode during world war II or did the market display different characteristics such as lack of volume or liquidity? Thank You

Q: If the Canadian economy is working on all cylinders WHY is the market not reflecting this. Markets should be a good indicator of the over all economy shouldn't it. Very frustrating!!

Q: Hi Peter and Associates,

I hear some talk of tax selling as early as August? Some professionals speak of setting up their portfolios to avoid and/or to take advantage of year end tax selling pressures? Some sectors and/or specific stocks have seen modest to significant declines this year and risk seeing above average volumes of yearend tax loss selling?

Many experts do not suggest trying to time the market but also talk of good entry points to initiate a position if not starting with partial ones to begin. Then there are those who factor in seasonality or other technical indicators. Without wanting to sound pessimistic, more than a few guests on business programs express caution, have increased cash weighting to have dry powder in reserve.Markets are not seen as cheap but opinions vary as what to do?

Bottom line, market corrections are part of reality and one has not occurred in some time? What percentage cash might be viewed as a reasonable cushion for a middle of the road risk investor with a 65/35 (Equity/ Fixed Income) objective who would prefer to reduce equity exposure by building up some cash reserves at this time? What suggestions might you have in response to the above and specifically, what reduction in equity exposure might be reasonable and/or sufficient to have substance? Assume a 5% weight in gold forms part of the overall strategy and a sufficiently large portfolio to provide diversification and no over weightings within it.

Fundamentally, are there any specific strategies an investor might use or at least consider in the last months of any year and more specifically this year?

Thank you.

Mike

Q: Dear 5i
I look at the chart of the TSX and see that its been trending downward over the last 6 months or so while the S&P and DOW have been trending upwards over the same time period . My thought is that it might be a good time to invest in the TSX now as that downward trend is most likely to start to reverse upward and not invest in the DOW or S&P as that trend is likely to reverse downward . On the other hand 5i generally advocates investing into strength meaning investing the opposite to what i`m suggesting . The other thought of course is to invest equally amongst them all so diversified across the board . I know predicting the market is impossible but i still like to invest to some degree on probabilities .
Appreciate your thoughts .
Thanks
Bill C.

Q: I presently have no healthcare or tech holdings in either my RRSP, TFSA or cash. Am retired,like dividends, but can take some risk.

Looking at having 10% in each sector with HHL (50%),CSH.UN (25%),GUD(25%)in healthcare and TXF(50%),ABT(25%)PHO(25%) in tech.

What do you think of this approach and the individual holdings?

Where would you put each one ( RRSP,TFSA cash)?

Thanks Derek

Q: With the conflict that is on going with the U.S.A and North Korea is it better to have a wait and see attitude before putting anymore funds into the Stock Market. Thanks . Ernie

Q: Just watching BNN and an analysis by CITi reports that a consistent metric to use is free cash flow per share .....FCF/S.
When you eveluate a company and do a report,do you screen and report this metric?
Thanks

Q: I would like to hear your opinion on holding a cash position inside a stock portfolio (not counting any sort of life emergency fund). I read lots of company (Berkshire, Apple, etc) are building up big cash position to better pull the trigger when a market downturn occurs. If it can temporarily be good for a company, is it the same for an individual investor ?

If we take my current situation, I am 27, no debt with a decent job income which I put steadily towards stock investing. I currently hold a 5% cash position as a buffer between my income and my investing. Do you believe it’s enough ? Is my strategy of buying over time with my income without building a larger cash position my best option ? Would you consider building a larger cash position 8 years into a bull run as market timing ?

Thank you !

Q: I have just read a new article with a doomsday comment about another financial crisis being on its way. "The same problems that caused the financial crisis are back". I understand that no one can really predict things but given the strong upward trends that we have seen one could expect some sort of correction. To take a conservation approach how should one adjust their investment distribution. What sectors are less affected? and would ETF's or mutual funds be safer that stocks? What about bonds? This is probably worth a couple of credits. Thank you, Doug

Q: Just comments.AIF-basing on better than expected Q2 revenue & eps,3 firms(TD,CF & RY) raised target price to $36 & upgraded stock.Reportedly best one day performance since 8/15 PKI-RY & BNS downgraded target price to $31 & $33.75 CGX-6 out of 7 firms downgraded to $46-$52.1st time in the last 3 years that Ellis Jacob is not that upbeat in interview on BNN after release of results. In this strong earnings season,strong results will be handsomely rewarded(eg AIF,SHOP,TOY),& vice versa.