Investment Q&A

Q: I have $500k in cash to invest. Getting into the market with current economy and market conditions is hard for me to do. I have asked around at other firms and of course the answer has always been "Get in now. why wait", but I believe that they are biased because they will make their fees from me even if I lose money during a market correction.

As an example I did some back calculations using a tool on Steadyhand's web page and the rate of return from 2007 to 2016 compared to 2008 to 2016 is significantly different. By waiting one year the annual ROR changes by almost 100% (5% 2007-2016, 11% 2008-2016). It is interesting how nobody ever talks about this.

I would like to wait until the market correction happens, whenever that may be, but I need some unbiased advice.

I realize that this question has probably been asked before but I think that the answer to this question has to take into account current conditions and where the market is compared to historical norms and averages.

If I was using one of the 5i portfolios it would be the Income portfolio.

Q: Are you aware of any articles or texts that have studied the tax loss selling phenomenon? Opportunities and risks that this presents to investors? Thanks.

Q: I am curious to know why the Bloomberg coffee index is trading at an all time low. Can you tell me the main catalysts? Is the market oversupplied? Does this look like a good long term trade at these levels.

Q: what is your short and long outlook for gold and the canadian dollar?
i presently have some u.s. cash and was considering an investment in gold (specifically in Kinross U.S.) both for a positive return and portfolio insurance.
I believe that when gold goes up the u.s. dollar usually goes down...
am i correct in that assumption?
appreciate your comments on the above strategy...
ed in montreal
p.s. - if you have an alternative strategy it would be appreciated!

Q: Hi Team,

I'm looking to park some cash in a no risk investment. Funds that are earmarked for use in 1-2 years. Where is my best return these days?

Thanks!

Q: I am concerned that I have too many interest sensitive investments in what looks to be a rising rate environment. I am a recent retiree with a need for income. I would appreciate your views on my sector weightings:
15% Reits
11% Financials
11% Information Technology
10% Utilities
6% Pipelines & Energy Infrastructure
5% Telecom
4% Industrials
2% Consumer Discretionary
2% Healthcare
1% Consumer Staples
1% Materials
18% Bonds
8% GICs
6% Cash

Your service is amazing and I really appreciate the new website.

Thanks,

Q: Good day,

Recently you have commented that 5% is about right for the Energy sector right now and that a recovery may still be a long way out. Would the 5% include pipeline/infrastructure companies like Enbridge or would you put those into more of a Utility weighting for the purposes of allocation?

Have a great day,

Derek

Q: It looks to me that the odds get worse every day of NAFTA being torn up, and not simply amended. If this comes to be, what would a strategy be protect my portfolio? Where can a person hide most effectively, and what sectors should be avoided ?

Q: Will these Canadian companies greatly benefit from the US tax cuts and would your recommend any or all of them as buys at this time Are the other Canadian companies you would prefer. Thanks for your terrific service.

Q: It seems to me that the ability to pass tax reform in the US is a significant event. Could you please comment on the impact of this event with respect to market valuation as well as benefiting sectors.

Q: Hi there,

I currently follow the BE Portfolio with a slight growth tilt. I have about 25 positions on, each starting with a 4% weighting. I have done very well few names such as SIS, SHOP, PBH, TOY etc. At what weighting would you recommend that I trim back positions?

Thanks!

Q: Markets have been pulling back the last few days. Do you attribute this to tax loss selling or something else? When would you suggest deploying cash?

Q: I am in my 30's and have a fairly diversified portfolio both geographically and by sector. Currently i own 100% equities with roughly a 70/30 split of growth to value companies. This money is for retirement and i don't plan on touching it for the unforeseeable future. I don't want to do anything drastic but i would like to get slightly more defensive going into next year. The bubbles i see in cannabis/bitcoin at the moment as well as i see many friends/family who normally don't invest or talk about investing starting to put money into the market (mostly in weed/bitcoin stocks) scares me slightly and i feel we could have a minor or slightly larger pullback at any time. Which of the following would you suggest. Add a 10% weighting in fixed income? Trim some of my growth winners (TOY,KXS,SHOP,etc) and add to some of my value names (XTC,OTC,WPK,etc)? Trim some winners to have my cash position move from 5% to 10-12% and add to positions when i see more value? I realize these can be personal questions but i am looking for your feedback anyways.

Q: Good afternoon 5i. I own the following stocks. Today there`s been talk about possible sector rotation of funds going from tech to financials. The Nasdaq is down 1.3% today. My portfolio stands as of right now at 22% tech and 15% financials. Would you recommend I leave my portfolio as is or should I lean more towards financials going forward?

Thx/Rob

Q: Given a ten year hold position and wanting a low risk option would you recommend a basket of quality ETF's or solid dividend producing stocks like Canadian banks. Thanks

Q: It appears to me that you favor diversification outside of Canada and the U.S., even though your primary recommendations cover the Canadian market. What would be your top recommendations for the emerging markets, India, China, Japan, Europe, etc ?

Q: I'm wondering if your service will keep members posted on the yield curve trends in the US?
I'm no economist. But many pundits are saying big trouble lies ahead: Short term rates increase, long term rates don't, curve flattens, recession hits, corporate bonds default massively, blood in the streets etc etc. I think I am a typical member, in that I have some confidence that I am building a portfolio that works for me ( with help from you). But I am lacking knowledge about the macro risks that could wipe me (us? ) out. Will 5i monitor and comment occasionally on this risk?

Q: Can you clarify one of your comment?
In inflationary times Canadian markets outperform
the USA market ! Why

Q: I've recently sold my holdings and am entirely in cash. I'm wondering whether I should wait for a correction and take advantage of some bargains or whether I'm better off getting my money invested and not worrying about marketing timing. I realize you cannot "crystal ball gaze" but I'm interested in your comments regarding staying in cash and waiting for an opportunity to present itself vs. getting back into a portfolio. Thank you.

Q: I am 10 years from retirement with no company pension.I have a good size RSP and TFSA along with an equal registered account.In your opinion what percentage of my portfolio should be in bonds and in what type of funds.I only see junk bond funds that are giving any kind of returns but risky while government bonds are only producing 1% returns.What does a guy like me do .I need 10 years of steady 5-6 percent returns to fund s decent retirement but can't bet the farm.I am currently invested in geographic diverse funds and some hedge funds.