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Investment Q&A

Not investment advice or solicitation to buy/sell securities. Do your own due diligence and/or consult an advisor.

Q: I am interested in your views on why the stock market suddenly became so enthusiastic about Trump when it was continuously going down a couple of weeks ago when it appeared that he would win. In the middle of the night on Nov 8th, the Dow futures were way down as expected and then miraculously they rebounded in the morning. Should we expect this to last?
Read Answer Asked by Maria on November 11, 2016
Q: Hi guys,

I was looking at Free Cash Flow Yield as a metric to evaluate companies that I want to invest in. Do you find this metric useful? Also, what would be considered a good free cash flow yield? I've heard people look at companies with 10% free cash flow yield, but that seems like it would be hard to find. Some of the companies in my portfolio like Disney and Stella Jones seem to have closer to 5% free cash flow yield. I know Disney has been investing heavily in their parks, which has lowered their FCF yield in the short-term.

Thanks,
Jason
Read Answer Asked by Jason on November 11, 2016
Q: Thoughts about adding to my position in CGI. Results looked good. Net debt down to $1.3 billion or 15.8% net debt to total capitalization. Down nicely from over 40% after Logica acquisition. Company is buying back shares even though there is no dividend. Double digit eps growth over the past year.

Jason
Read Answer Asked by Jason on November 09, 2016
Q: Hi Peter and Team,

Fortunate timing in light of yesterday's surprising election results: Our daughter-in-law learned just yesterday that her RRSP of $77000 and her LIRA of $22600 that previously contained under-performing high MER mutual funds were transferred (in cash, thank goodness) to her new accounts at iTrade which I will manage. Given today's volatility, and volatility going forward, what should she do? She is a "60% equity, 40% fixed-income" investor. Thanks so much in advance for your valued advice.
Read Answer Asked by Jerry on November 09, 2016
Q: I own IPL and I was reviewing their Q3 release on Friday. I am having trouble reconciling their net debt to total capitalization ratio of 54.5%.

Based on their MD&A, total debt is $5,596.6, shareholder's equity is $3,269.9 and cash and cash equivalents is $70.4 and restricted cash if $105. This gives me a net debt to total capitalization ratio of 62.3% without including the restricted cash and 61.1% including the restricted cash. IPL Q3 reports 54.5% net debt to capitalization. Not sure where the error is. I inquired with the Company, but I haven't received an answer. I was wondering if you could provide one?

Thanks,
Jason
Read Answer Asked by Jason on November 09, 2016
Q: I have an income portfolio that is patterned after your model income portfolio with a few differences. My portfolio currently has 21 positions with a 5% holding in each of BEP.un and BIP.un. Do have any thoughts on the merits of holding both these companies in the portfolio? Should one be sold? If so, which one and why? Thanks
Read Answer Asked by John on November 09, 2016
Q: Greetings Peter et all,
I am in need of your astute assistance.
Scenario:
A 58 year old with failing health. (10-15 years?)
With approx 600K to deploy...I require approx 4K tax free from dividend and stock appreciation to maintain a life.
Need appropriately safe investments to achieve above.

Small, safe, manageable, tax friendly.

Two example vehicles would be very much appreciated thank-you

Be well my friends
Read Answer Asked by Alex on November 09, 2016
Q: I have small positions (less than 0.5% each) in WEF and CCO, both at losses (20% down on WEF, 62% down on CCO). I am debating whether I cut my losses on each and consolidate this freed capital into increasing my position in CAE (currently at 0.5%: making this move would increase my position to about 1.2%).

In defence of WEF, I know that this is a cyclical company, and with the prospect of more construction in the US (I believe there have been some rumblings about increasing house construction in the US), I am aware that WEF could improve over the next 6-12 months. Also, it pays a 4% dividend to wait, so that would be another case to keep it. As for CCO, I am not aware of any tail winds for uranium in general, but I don't think CCO will head much lower than it already has.

On the other side of the argument, I am aware that hanging onto losing positions in the hopes that they improve is not a successful strategy. I believe that CAE is a company worth investing in, and I do plan to increase my position in it, either by adding capital to my investing account (which I will have to wait on until extra capital becomes available to me for investing), or redeploying my existing investment capital.

My question is whether I act now by selling these companies, or whether I hang onto them and wait until I accrue additional free cash to increase my CAE position. I am unwilling to sell my other positions in my account at this time. Thanks so much for your time, and I await your reply.
Read Answer Asked by Domenic on November 09, 2016
Q: Out of the above list, which ones would you buy today regardless of portfolio weightings.
Read Answer Asked by Gooding on November 08, 2016
Q: My 25 year old Son started a new job with a group retirement or savings plan, the plan suggests for an aggressive investor; 60% Canadian, 25% foreign and 15% specialty equities. They offer asset Allocation Funds, for instance the Aggressive Growth has a 10 year return of 6.24% with an MER of 2.018, also several individual Funds like the True North Fund (Fidelity) with a 10 year return of 8.3% with a MER of 2.313% The other managers of individual funds are; GWLIM, Mackenzie, Beutel Goodman Montrusco. I,'d appreciate 5i's opinion on what advice to give a young investor on how to pick from the limited options all of which have 2% + MER fees.
Read Answer Asked by Charles on November 07, 2016
Q: Hello I5, my cash position is over 25% and would like to reinvest some of it. I would like to have your help to choose the ones with the least downside effect in case of interest rate increases, safest with some growth. Also, would appreciate your assessment of the Manulife (MFR and MBK)ones. Many thanks, J.A. P., Burlington
Read Answer Asked by Joseph on November 07, 2016
Q: I do not own any stocks in this line of business. Which one(s) would you recommend and should I go for a full or half position?

Thank you
Read Answer Asked by Vee on November 07, 2016
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