Investment Q&A

Q: Hello Peter, I am thinking of shifting my portfolio to bit more defensive and generate some income too -
1. option 1 - To increase allocation to fixed income / bond type position.
2. option 2 - To buy more of defensive positions - like BNS, BCE, CU, FTS, MCD, HD, JNJ,
3. Counter position - that would have counter move to market drop.
Question - How would you approach / handle the situation and what would be your choice in each option.
Thanks

Q: What would you suggest looking to buy in anticipation of a potential crisis in the Middle East which unfortunately now seems imminent. Oil and gold I suppose are the obvious sectors that come to mind. Thanks.

Jason

Q: I want to rebalance my portfolio and increase my US holdings to ~60% of my portfolio using ETF's.
I currently hold VFV (15%), VB(10%) & VIG (10%).
- What other ETF's should I consider adding
- Recommended percent in each.
My timeframe is 3-5 years
You provide a great service for investors, thanks to you and your staff...

Q: When will the buying of stocks begin for 2020. Most of the stocks that I hold have traded below their averages for more than two weeks.
Appreciate your service.
Clayton

Q: Hi could you please share your views on the level and direction of interest rates for the next 1-5 years. Thanks.

Q: I'd like you to comment on a change in the banks recently as per Money talks

in short... end of July saw all 5 banks reporting quite well with Loan Loss Provisions (LLP) as expected if not maybe a little low.

Now this past week all five appear to have seen significant turns.

CIBC saw their profit dip 6% which is really unheard of. Plus, they increased the Provisions for Loan Losses (PLL) by 52%. TD earnings slipped 4% with a PLL increase of 35%. And Royal Bank president Dave McKay said "based on what we're seeing today the next couple of years are likely to be challenging." RBC Provisions for loan losses jumped up by 41%.

I read somewhere else where it was said these increases in funding for loan loss preparation is an indication the banks are "down turn ready." Is this the canary in coal mine?

With all the recent growth in the markets, is this something we should be concerned about? I think this could be a very significant story-line moving forward for investors.

Thanks for all you do

gm

Q: I have quite a bit of money to invest but I am in no hurry, maybe even in January as there are a lot of problems in the world just now.
impeachment, British Vote,,Brexit, Trumps antics, upset world
What are your thoughts or suggestions

Ernie

Q: I was interested in Brookfield Asset Management CEO Bruce Flatt's comments during a BNN interview with Amanda Lang this week. Flatt said that "We are close to 11 years into this economic cycle. I don't think economic cycles have been repealed; there will be a recession." He added that Brookfield is more cautious today than it was in 2009 during the world financial crisis. His company is holding lots of cash and staying diversified to weather the downturn. With 5i's years of investment experience, I would appreciate your opinion on the risk of a recession and your recommendations for capital preservation of investment money if such a situation might occur. Thanks!

Q: There is all this talk about a recession coming and sharp drop in the markets. I'm wondering what is the best way to respond to these events when they occur? If we look historically is there a trend that points to the best time to start buying after a big market drop? I'm just thinking when he market has dropped say 20% in a day due to an event, some may jump in instantly or the next day and invest their cash holdings, then the market may drop another 10% due to panic. Is it best to ride it out, but maybe miss the first post pullback pop, I believe you mentioned most bear markets last a year or 10 months roughly on average, so what point of that cycle was historically the best on average to get back in, 3 days, 3 months, etc? Thx

Q: In your answer yesterday to Michael regarding economy as a whole you said .... The keys are interest rates and earnings. Interest rates are now moving lower, and earnings growth should be decent next year, after slower growth (tax cut comparisons with 2018 and trade wars) in 2019. We would consider it fairly valued. There is a lot of money sloshing around, and the economy is good. There are also far fewer stocks than in past cycles, due to buybacks and merger activity. While a 5% to 10% correction would not surprise us, we are not overly worried about a 2008 market-type scenario.
While true I have been noticing more and more layoffs in the news lately and was wondering at what point this has an impact.
CN. 3000 laid off
Alberta Innovate lays off 125 of 650 employees
U of C 250 laid off
13000 predicted layoffs in the oilfield coming
200 lost jobs in Kelowna Tolko mill
More mills in BC closing

Q: I am worried about Cdn household debt and the credit cycle turning..
What are some sectors should investors be in if this starts picking up traction?
Or should I be trimming into more cash?

Q: What is the ‘street’ telling you about the upside, flat or downside in the market for the remainder of this year?
Clayton

Q: Hi team
do you think that the market is fully valued now ?
can you name 1-2 sectors that are under-valued that a value investor could keep an eye on ? many thanks

Michael

Q: 1. Could you please recommend stock or etf for global or USA real estate exposure. Well diversified TFSA, conservative investor.
2. Could you also please suggest how to reduce exposure in C Cyc space. and increase in Industrial. In C Cyc currently own own MG and NFI ( C Cyc / Industrial) and WSP in Industrial.
Thank you

Q: I have a friend who has trusted his advisor completely . His basic investment account has 92 positions ... less than one third of the value in US and Canadian equities ( all in odd lots, like 14 shares of AAPL @ a profit of $56.00 ) , but most are in Mutual Funds ( everything under the sun ) . RBC have convinced him that because it is a million dollar portfolio, he gets a very “low fee”, You have trained me well ... stop this insanity right ? Buy great stocks and where you want broad exposure and indices buy ETFs ...right ?

EXCEPT
I don’t know how he can get out of 40 mutual funds and 50 stocks without incurring ridiculous trading fees . His RSP,RESP and TFSA are all structured in the exact same manner ... same exact funds
If , for example , he directed his broker to transfer all positions to RBCdirect investing , would he avoid the initial hit of over 350 trades at 9.95 each ? OR does one make a deal with the advisor to get him out of this stuff ? OR does one make a deal with a different broker altogether ? OR does one complain to the securities people ?
I don’t know what strategy to use , but as per your video , he will be giving his advisor hundreds of thousands in fees and commissions .

Q: If you could pick the best 6 Canadian stocks right now for long term growth, stability and in 6 different sectors what would they be? What would they be ignoring sector restrictions?

Q: What would be a good company to buy shares in for a teenager for his first investment? It was mentioned before that it increases interest in investing if the teen knows about the company. I was thinking of Costco, Disney, Mcdonalds?
Would you be able to provide a top 3-4 names in Canada and 3-4 in the US as suggestions? Thanks

Q: In his profoundly influential book, The Battle for Investment Survival, originally written in 1935, Gerald Loeb states: "Indeed, should some super-solvent agency agree to preserve the buying power of capital for a substantial length of time at a stated fee per annum, informed people would embrace the plan enthusiastically if they felt there was any real possibility of the agency staying solvent."

According to Bloomberg, 17 trillion dollars are invested at negative interest rates today. Surely, much of that is smart money. Is that money acting on Loeb's dictum?

Q: Further clarification of my question re bond holdings in portfolio. md stable income fund is a segregated group annuity insurance policy holding 50% insurance and 30% short term bonds. I would like to decrease my weighting to 10% or switch to another short term fund as 20% plus cash holdings is hurting my returns. What percentage do you feel of a moderate rrif should be short term bond? Thanks once again for your opinion
Tom

Q: Can't believe how stocks are getting hammered on small misses in earning,etc.Are investors more nervous than usual and panic selling?