Investment Q&A

Q: Is US large cap tech too expensive to buy here, or does the AI theme make it have room to run up further?

Q: Here is a situation which is prevalent in many parts of my portfolio. for example, I have BNS at an average cost on ~$72. It closed yesterday at $64.50. If I go with 'timing the market' I should probably exit the stock. If I go with 'time in the market' I should continue to hold and collect the dividends.
Is there are 'rule' one can use and does that rule vary for large cap stocks like BNS or a small cap stock like PNE which I also own?

Q: Is the 'cardboard' metric a real thing? When cardboard sales dip, it is a precursor to an economic slowdown?

Q: Hi Peter, My question is about returns in the S&P during a four year Presidents term. On average what are the markets (ie S&P 500 ) return in year 1 vs year 2 vs year 3 vs year 4. I heard an analyst mention that the best returns come in year 3. Can you confirm the returns by year. I appreciate the great service.

Q: When lookking at the ROI over 3-5-10 years. The S&P has always done better than the others. When looking at the strength of their economy and the investment that US companies put in R&D how are they gonna loose their 1st position as a super economy power? and foremost and this is the question: Why invest elsewhere? Canada with merely 5% of the world economy? Europe has been lagging since I started investing 40 years ago where else? China? gotta be kidding. Seriously why spread our investments worldwide when the best is our neibours? Just buy the S&P and wait still forever.

Thanks

Yves

Q: hi, portfolio analytics says I am underweight basic materials, consumer defensive, healthcare and industrials. can you provide a few Canadian and US equities in each category, that you would consider for medium to long term investment.
cheers, chris ( take as many credits as you need ).
further, I am overweight in utilities ( 18.6% of total holdings ) and financials ( 25.5 %). do you recommend trimming these 2 sectors? and in financials I own BN and BAM ( which I would suspect actually have cross-over with other sectors? )??
cheers, chris

Q: US stock market almost recovered after a stunning run lately. The Canadian market is apparently still recovering. Do you think there is a rotation that will be going on, e.g. Canadian stock market, or non-AI stocks? I am wondering whether there are some Canadian stocks that may be benefit from the rotations that we can invest now?

Q: Dear 5i,
At a high level with respect to Canadian stocks.
Which sectors are the most sensitive to interest rate changes?
For the ones you identify can you please suggest how they might react
when rates go up or down?

Q: hi, any news accounting for the severe stock price decline today? further, what is your best guess as to where we are in the "recession" cycle now??

Q: How long do you think before AI starts changing things for companies? Where do you think we will see the first impact and what type of companies will be affected long range. I know this is a crystal ball question but your opinion of the future of AI and how we should prepare is highly valued.

Q: There is much speculation and commentary that we are either in a recession or will be in a recession in the next 6 to 12 months. I know it is impossible to predict timing or if we will in fact experience a recession but can you provide your view on how the markets react through a recession cycle, i.e. heading into and during a recession. Can you include the sectors that perform well during the cycle.

Thanks
Tim

Q: I manage my daughter and her husband's investments. They currently own the above equities (except XST), plus fixed income. I would define them as conservative investors.

Regarding their asset allocation, I am still in the process of building out their portfolio. They are a little light on Consumer Staples. I was trying to find a suitable ETF and came up with XST.

Q#1 = What are your current thoughts on XST? The constituent holdings actually look pretty good. The various rates of return also look good.

Q#2 = Are there other ETFs that I should consider? I couldn't find a BMO version. I have read the past questions on XST and it appears to me that XST is the front runner (compared to VDC and XLP), when looking at past performance.

Thoughts? Agree?
Thanks for your help...much appreciated...Steve

Q: Based on the current yield curve, what kinds of maturities should I have for my bond allocation? As the yield curve is currently inverted, and if we expect the yield curve to become normal again, then should I have more short-term bonds to benefit from price increases with short-term yields coming down?

Q: I'm heavily weighted, the Qs / semis, can you name some alternatives to balance my portfolio please?

Q: How do you feel about margin usage in the context of the current rate environment? Do you believe it still has a place for risk-tolerant investors, especially considering potential tax write-offs? Or do you think the potential risk/reward is simply not palatable at the moment? If the latter, what are some effective ways to reduce margin exposure without being forced to sell assets or unbalance a portfolio?

Q: Ray Dalio says US is at beginning of late Big-Cycle Debt crisis. What is your opinion on this and can you please explain what this would mean. Thank you!

Q: Not sure if this is within the scope of your service, but can you explain why a country like Japan with a huge amount of debt-to-GDP has not had a collapse of it's currency from YCC or huge inflation? How is it that increased debt has let to deflation? I've heard some reasons over the years but none that make sense.

The reason to ask is our Canadian, European and US governments also have a huge debt burden, increasing interest payments on this debt and a continuing increase in debt over the foreseeable future. How could any rational investor have confidence in this debt/credit based system? Will we turn Japanese? (to quote the Vapor's song!) What factors would push us into deflation vs inflation?

Q: Peter; This may be out of your purview but would the destruction of the Kherson dam in the Ukraine affect the grain crops and drive prices ? Thanks.
Rod

Q: Hello 5i,

What is your opinion on a potential liquidity headwind for stocks? Would you expect a broad short-term decline in stocks (e.g. S&P 500) or are specific sectors at a higher risk? Do you see opportunities to buy prior, during, or after the Fed begins to fill its reserves?

Thank you
D&J

Q: I note you were asked something similar to this last October, but that was with respect to gold. There is more talk of a desperate Putin using a tactical nuke in Ukraine as this is his only path to victory while failure means his own demise. I know you can only guess but my own guess is the overall markets would go insane, blow through circuit breakers and drop at least 10%-20% on the day. Is your more experienced, more considerate 'guess' somewhat similar?