Investment Q&A

Q: Hello, I would like to "park" some money in a safe dividend paying stock. Your service provides lots of choices/recommendations. However, can you say with any degree of comfort which sector or particular dividend paying stocks therein would be less sensitive to an interest rate hike, and less of a bond proxy. Or, are all stocks paying a reasonable dividend subject to this risk. I was thinking of Enbridge. Thanks very much. Bill.

Q: There is a link to an article in today's Globe by Meb Farber that calls into question the generally accepted wisdom that companies that grow their dividends are superior investments. (at least I think it is a generally accepted theory) Is this a theory that you have come across before or do you think that his argument has merit?

http://mebfaber.com/2017/04/26/dividend-growth-myth/

Appreciate your insight.

Paul F.

Q: Currently I have around 20 percent of my portfolio in US holdings. Given the nervousness of the Canadian markets re NAFTA etc., and the narrow range of Canadian sectors, would it be wise to increase the percentage of my US holdings? Secondly, should I keep the US shares in a sheltered or non-sheltered investment account? Thank you!

Q: Team,
My full service brokerage account currently has a cash position of 16% and my broker's position on this is that the account will be positioned for an anticipated market pullback and her thought is then to enter with the cash.
I am retired and live off the income provided by the account. The account is entirely Canadian dividend payers ( total of 23 equity positions) which range from 3% to 7% yields. The portfolio is largely banks/insurance ,pipelines/processors and some telecoms. My thought is to reduce the cash to around 5% and add to existing positions or else add a few defensive positions.
Appreciate your comments on the current position and thoughts as to best way to proceed.
Thx

Q: We have 2 RRSP portfolios 2 TFSA portfolios 1 locked in pension plan portfolio which I manage. I have recognized that there are different tax implications for the investments in each type of account and have invested accordingly to suit.I'm now drawing income from our investments and work with my accountant to withdraw as tax efficiently as possible.The question I have is would you manage these accounts as a separate portfolio in each account or as one overall portfolio when looking at percentage allocation of a Stock,ETF,or Fixed Income.

Q: Hi 5i team,

I want to sell into the market now to raise the level of cash in my portfolio. I need advice as to what stocks to sell first, given the current market conditions. Should I sell growth stocks first? Or income stocks first? Should I sell certain sectors first? Should I first sell stocks that are in a loss? Or stocks that have the highest % of gain over book value (ignoring tax)? Should I sell stocks that are close to 52 weeks high first? Please explain your strategies if you were to reduce the equity holdings to raise cash for your portfolio. Thanks for your guidance.

Q: I don't usually like market timing and don't really believe in this "sell in may..." stuff, but this year is a little different. What are your thoughts if the Trump administration is unable to come up with a concrete tax reform plan by may/june? Would they have time given congress goes into break shortly after? I would expect there would be volatility ahead, but have you experienced similar events like this in the past where there's been bets on policy changes that don't materialize?

Q: WHEN A COMPANY SAYS IT IS EXPLORING ALTERNATIVES AND HIRES AN INVESTMENT
BANKER TO EXPLORE THOSE ALTERNATIVES; HOW OFTEN WILL A SALE HAPPEN IN YOUR OPINION? I REALIZE THE BOARD WILL ONLY SELL IF THEY GET A GOOD PRICE BUT I WOULD APPRECIATE YOUR THOUGHTS AND DO YOU THINK CDI-N IS WORTH HOLDING FOR A POSSIBLE SALE? I DO NOT OWN THIS COMPANY YET BUT WOULD CONSIDER PURCHASING IT. THANKS

Q: I purchased today 10000 shares of HXD. I consider it like an insurance policy in the event of a bear market to cover my long positions. Is this a reasonable approach?

Q: Hi Peter and group as always I value your opinion. I am getting increasingly nervous about world affairs (Trump)- do you have an opinion on taking some risk off the table?If I decide to take some profits on my cash trading account do you know any way that can off set the Capitol gain?. Just to confirm my understanding is that the Capitol gain is due and payable immediately. Does leaving the cash in the account make any difference as to when the tax is due and payable. Thanks PS I understand this is 2 questions

Q: Good morning 5i team!
I have a joint RESP account for my children who are 11 and 9.
At this time I have approx $85k in the account distributed as follows
$23 bond 2.10% mat June/2018
$22 k in VDY
$32K in VFV

I have a remaining $7k+ and wanting some growth, dividend with stability so I won't lose as it is a more short term time frame.
What do you think of the overall weighing of the portfolio and what would your suggestions stock wise be for the $7K.

Q: Savaria on a nice roll of late. Dividend rate now around 2%. How does a Company in a situation like this decide how much to raise and when. What factors are involved.

Q: Hi,

I have cash after some bonds came due and am considering either ZWC or a rate reset preferred such as RY.PR.R. I am risk averse and hate to lose money! I feel that there will be some sort of correction soon. Your views much appreciated...

Thank you

Q: For a moderate risk investor, who tends towards long-term hold (with occasional portfolio adjustment), what would be a reasonable sector allocation? I have been a long-term member of 5iResearch and have learned a lot about investing. Thanks for the great service.

Q: From your experience did you find that, in an upward market, inflow of money into mutual funds increases and therefore accelerates the upward momentum and the opposite is true as well? Today with all these ETFS can this occur with ETFS as well? Is the popularity of ETFS (funds flowing in and out) is adding to the volatility of the market. Would you see a panic scenario causing a major collapse?

Thanks.

Q: What happens to the Cdn dollar if the US dollar tanks? Is the Cdn $ value based on a basket of foreign currencies of which the US$ is held in abundance?
Thanks

Q: Hello 5i.
Thanks for the ongoing investor communication/Education.
I have had slightly positive overall results with mixed individual stock selection results utilizing 5i information.
Would have liked to be on the Shop ride but I could not buy into a stock moving up everyday and now doubled in three months. How do I not miss this next time?
I did buy the indicated holdings (SIS, GUD, ET, SYZ, PUR, TNC=cash)
Excluding TNC, the mix leaves me up 6.9% in the time frame of about a year or so..SYZ since 2014 and some various buying along the way.
I am not doing as well as you Portfolio so stock selection and timing clearly makes a difference.

With this list, should the Holdings be at full weights now for all of them?
For example, PUR is under small cap $ allotment while SYZ is over allotment.
Is there something I should be adding that is most appealing today even though I personally may have to hold my nose and buy? (Portfolio is well diversified and balanced)

Also, it is clear I am not benefiting from the stock category you sometimes highlight as "winners" or "1000% gainers" to help propel my portfolio gains. Should I be trying to buy all the investment in your total portfolio or how does one use 5i service to benefit to the max?

Thanks
Dave

Q: Can you please explain he correlation between bonds, stocks, reits and gold?

id like 30% of my portfolio to move differently than the markets in case of market correction but dont want it all in bond funds due to rising interest rates. how would something like this look over the long term or do you have a better suggestion?

10% bond fund
10% REITs
10% Gold half xgd, half bullion
70% equities (CND, US and ITL)

Q: Market timing is generally frowned upon by professionals including 5I.I find myself selling a number of my positions because of valuations and good profitable outcomes. I also find that I am not redeploying that cash because of valuations! I firmly believe in taking profit and some of the greatest mistakes I have made are in regards to holding positions to long. To many times in my early investment life (the round trip) occurred. After a number of years I relized that you are investing 2 commodities "dollars and time" and I could not continue to keep exposing my dollars and losing time. So if I sell my winners and do not redeploy my cash in a timely fashion then I would seem to be guilty of "market timing".

Why am I so wrong!

Randy

Q: My question is about portfolio balance. Right now I am very overweight in technology (30%) But it isn't all the same kind of technology. For example , Facebook, Shopify and Google are not the same sort of business as Avago and Texas Instruments. And they, in turn, are different from Constellation Software and Kinaxis (also different countries). These are the companies I own. So would you recommend I reduce my tech weighting, and to how much?