Investment Q&A

Q: Could you please list a few efts Canadian and US that would protect from a down turn in the market.

Q: In regards to Kenny's question on portfolio rebalancing, could you please suggest limits that would trigger a rebalance. I understand this moves towards personal risk tolerances but in terms of overall portfolio volatility what could you suggest as a position limit? Thanks.

Q: Boy, tech is being devastated today NVDA FB/ AVGO/ LRCX etc etc

What is causing this nuclear devastation amongst these high flyers all today and all together?

Thanks for your insight

Sheldon

Q: I am very impressed with your ability to limit your balanced portfolio to 25 stocks. Currently I hold the above six stocks in the financial sector whereas you hold three. The only one with large imbedded gains is REF.UN which I have held for over twenty years. one third of our total portfolio follows your balanced portfolio. The other 2/3s is managed for us and includes a large allocation to canadian banks. I am willing to sacrifice some stability for more growth. Would you consolidate any of the above stocks to simplify the portfolio? Below is my current allocations. My bias is to keeping REF, GSY and ECN.
2.23% aif
3.16% ref
2.36% ecn
1.90% fsz
2.54% gsy
1.86% slf

Q: Hi Peter, Ryan, and Team,

I understand the rationale for different weighting of sectors among the three portfolios. You've stated in the past that we should look at our entire portfolio to "determine where we stand", and I've done this for my RRIF, my wife's RRSP, both of our TFSA's and our joint Margin Account. I use Google Sheets to track this entire portfolio. My question is this: In a 'composite" portfolio, how can one determine the appropriate sector weighting, or is it purely a personal choice? For example, Technology is 21.38% of the Balanced Equity Portfolio, 32.05% of the Growth Portfolio, and 7.26% of the Income Portfolio. In our 'composite' portfolio, Technology has a weighting of 10.83% of the portfolio's equity portion. So I suppose my question would be "How do I know that my weightings are appropriate, and once weightings are chosen, do I stick with them? Or should they vary for different points in the economic cycle?"

I have another question that I'm hoping can be answered by one of our computer-savvy members: As mentioned, I use Google Sheets to track our portfolio which can "capture" the stock price for popular indexes like the TSX. However, there's a "new kid on the block", namely the Aequitas Neo index, and I haven't been able to "capture" prices to be inserted into Google Sheets automatically. As an example, a Canadian Money Saver top-rated ETF, (CLU) is no longer listed on the TSX, but is now listed on the Aequitas Neo index. Do any 5i members know how to accomplish this "price capturing"?

Given that there are several questions in this long-winded question, please deduct as many question credits as you deem necessary. Thanks for all your help! Now I'm going to watch Peter on BNN which I PVR'd earlier!

Q: Hi 5i Team, How does one prepare the RRSP portfolio for flipping into a RRIF the following year? Your strategy. Thanks.

Q: Greetings 5i team. Looks like the American public is more and more in favor of impeachment of President Trump. If indeed, he is impeached, what impact do you think this will have on the market? As a follow up question, should we as 5i members be changing our porfolios in any way to adjust for a possible impeachment?

Q: When trying to use versions of your 3 model portfolios I would ask your recommendations of using stop loss, if any, on which names and what %, as a general guideline. My main concern is the income model as I am treating this more as a fixed income version knowing the increased risk. Thanks for your insight.

Q: Foreign asset and currency exposure.

As a retiree, I am concerned about the non-Canadian content of my portfolio. While all my holdings are listed in Canada, an increasing portion of the issuers' assets and/or revenue is in other countries, primarily US.

Are there any meaningful fx predictions for the next 5 years?

Is it fair to assume that issuers which report in US dollars will hedge, if at all, foreign revenue to US dollars and disregard
the fx risk of US revenue to its Canadian shareholders, even in cases (eg Brookfield) which are managed in Canada? On the other hand, I suppose that issuers which report in CAD would be motivated to hedge their USD revenue.

Q: I realise this is a hard question to get right but here goes: If you had some Canadian dollars to change into US dollars would you go for it now or wait?

Q: Good afternoon,

I'm thinking of replacing individual stocks that I've held for a long time in my RRSP with either XAW or VXC for the foreign portion of the RRSP portfolio and adding XIC or XIU for the Cdn portion of the portfolio. Is this a good idea and if so which would be your preference and recommendation. Thank you.

Q: i have a bit of a high allocation to banks and i was thinking of trimming Bns. I am also doing this because i have some fear of a housing bust and the proximity of the banks to such an event. And also because there may be a good chance that capital gains tax will be increased next year. I will re invest this money and my question has to do with what sector do you think would be the safest if a housing crash should result. For instance i had thought of buying Canadian Tire. But, i imagine a drop in the housing market will have a big affect on their sales as well. Appreciate your thoughts as usual

Q: There is growing concern by well-respected economists and investment analysts about what appears to be out-of-control government debt - especially in the Western World. Like the 2008-09 mortgage crisis, a time when "nobody saw it coming" (fortunately the online investment program I listen to weekly had me prepared 18 months ahead) most people have their collective heads in the sand once again.

I have no idea what the end game is, but while I was prepared for what was eventually to become known as the Great Recession, I don't know how to prepare myself this time.

I am 70% in dividend growth stocks, 30% cash. I don't plan to sell any stocks but am not putting anymore money in the market at this time. Recessions historically occur about every 8-10 years, and this bull is arguably getting extended.

I've added some gold bullion and a bit of CEF.

I believe you had mentioned, if I'm not mistaken, about keeping under $100K at any given institution to avoid any potential future bank "bail-ins".

What other ways can one diversify?

I realize there are enough "chicken littles" out there that we have to listen to, and am aware of the potential missed opportunities of timing the market. I just want to make sure I protect enough of my assets, as I am only 20 months away from retirement. This kind of prudence has served me well in the past just ahead of the 2000-2001 Tech Wreck and the mentioned housing crisis.

Thanks.

Q: I'm underweight in materials, energy, and utilities. My only exposure to these sectors comes through some total market ETFs I hold. With the current market conditions, would you view adding to these sectors as imperative or would it be more prudent to add to my tech and consumer holdings? If so, could you rank the value of the sectors to my portfolio (where should I stick my next investment first)? Please note, that I do plan to fill out these sector positions eventually and that I'm a young, growth investor with a long-term horizon.

Q: Just curious what you think of the last three days of market activity.

Q: Over the last few years, I've become familiar with the likes of David Stockman, Marc Faber, Jim Rickards, Peter Schiff, Jim Rogers, and other well-known perma-bears. They spend a lot of time warning about sky high stock valuations, extreme asset inflation generally, the banning of cash, the importance of precious metals, impending market crashes, runs on banks, the freezing of stock exchanges, and other light fare. I try to balance their dire outlook with more sanguine perspectives, but I'm always wondering if some of the extreme scenarios they envision will ever materialize.

For instance, Marc Faber appeared on BNN a few days ago, warning that the share prices of some of the most successful companies are headed to zero in the coming years. He didn't specify which ones.

Are you familiar with any of these pundits, and should any of their warnings be taken seriously? Thanks for your thoughts. I'm due back at the bunker now...

Q: My question is on over diversification - or indexing. My personal portfolio is over 8 figures. I currently hold 44 stocks spread accross the various sectors as shown below.

Technology 17%, Consumer Cyclical (Discretionary) 15%, Financial Services 15%, Industrials 11%, Consumer Defensive (Staples) 10%, Basic Materials, Metals, Mining 8%, Healthcare 8%, Communications / Telecom 5%, Energy 5%, Real Estate 3%, Utilities 3%.

The stock choices within are the BE portflio plus some top picks. With a portfolio of this size, my mind is having a hard time dropping the portfolio down to 20 stocks. I guess it is all relative. In your experience as a fund manager how many stocks are about right? I have adopted your style of buying a stock and holding it until the story has changed.

Thank you

Q: Peter; In your experience are there any comparable times , I.e. Nixon, as to what the market does during an impeachment? Thanks. Rod

Q: Could you please state your latest sector allocations? Thanks to your recommendations,my tech.allocation has grown to 28% of my portfolio.

Q: Hello team, I am fully invested (stock/etf's leaning toward growth) but am getting somewhat concerned about where the market is at. It seems (in my layman's eyes) that valuations across the board are getting stretched relative to fundamentals. I can take some profit and am wondering about some "insurance" in sectors such as gold; either cdn stock or etf's. For context, this is a registered account, 5 to 7 year horizon, mid 3 figures. Any suggestions