Investment Q&A

Q: Hi Peter,
I wondered if it would be possible to have a list of your best recommendation updated regularly. I understand the model portfolios have a similar role, but for example have a more focused list (10-15 stocks) of high convictions stocks updated monthly would be interesting.

Thank you for your good work.

Q: With your help my TSFA has grown from a hobby to something a little more serious . Thankyou. I have had ESL and DH for a year and a half, DSG for 2 yrs.GIB.A for 5 mo. Also in TFSA
are MFC TD CXI WCP. The 4 tech stocks now make 55 percent
of this. Every time I think of trimming back (probably ESL )
they keep going up. What do you think ? If I sold anything I
don"t know what I would buy anyway. Have XTC ZUH ZLB and BIN
in my RRSP.
Thanks again for your time .Without your help I probably
wouldn,t worry about this stock market business.

Larry

Q: heard a very positive report about them---their restructuring and management...Do you have any recent info on them?

Q: Dear Gentlemen,
I am in the process to rebalance my PF, based on 5I Summary list, I have companies classified in Services, Consumer Goods, and Financial Service, I assume that these 3 sectors are not in the 10 TSX sectors.
What do you suggest for these 3 sectors, to merge them them with other sectors or keep them and allow % . If so how much ?
Thanks Best regards.
Quote : On average, we would suggest a portfolio similar to this:
Utilities 15%; Financials 15%; Energy 10%; Materials 5%; Telecom 10%, Industrials 10%; Healthcare 5%; Info Tech 10%; Cons. Discretionary 5%; Consumers Staples 15%.

Q: Robert's Feb 26 question about the arbitrage opportunity in BCE's acquisition of Glentel inspired me to try to calculate the downside risk of buying GLN now. Please correct me if I'm off base in my math. Assuming you can acquire GLN shares now at $24 and a 50/50 cash/stock split on closing, the BCE share price would need to fall to $43.23 [26.50 / 2 = 13.50] + [42.23 x .4974 / 2 = 10.50] = 24.00 total to eliminate any gain. If you were to receive all shares and no cash, break even would be $48.26 [48.26 x .4974 = 24.00]. It's possible BCE could re-visit the $48 range, where it was for much of 2014, but dropping to $43 would seem less likely. As a side note, I see that over 8 million BCE shares traded right at the bell on Friday. Average daily volume is around 2.5 million. Was this simply end of month fund re-balancing?

Q: Hi,
I have these four in my TFSA. A bit heavy on CGX and STN but okay with the imbalance. Long term horizon. Now have about $7500 cash. Would would you recommend?

Q: Hi 5i Team,
I have reasonably balanced portfolio. Looking for growth/stability in non registered cash account. What percentage among these would you spread cash over the next six months? Which ones first and what %? Long term horizon. Any others instead of these ones?

Q: Hi there,
I only have a 4% weighting in health care and own JNJ. I would like to increase my health care weighting to 10%. I was thinking of buying some XLV, CCT, and GUD. (CCT and GUD would go in our TFSA's). How does this combo seem in terms of diversification, balancing risk and growth. Any other recommendations instead?
Thanks, Kerri

Q: Hello 5 I, Canada Pension Plan purchased 341,900 of Kelso recently and was wondering if I should get excited about this?

Q: Peter, one year ago I purchased IPL over Enbridge and it represents 3.5% of my portfolio. I want to continue to hold the same weighting in a pipeline but was wondering if I should switch to ENB? I buy and hold stocks for the long term.

Stephen

Q: In relation to the question i just posted regarding portfolio construction, i have another question. In two different answers you give quite different percentages for asset allocation. I am surprised that there is such a difference in the two. One for "an average investor" gives this breakdown:
For the average investor, based against the TSX sectors, we would suggest these allocations; 
Consumer Staples  5%
Consumer Discretionary 10%
Energy  10%
Info Tech  15%
Materials  10%
Industrials (with some US) 15%
Healthcare  10% (with some US) 
Financials  10%
Telecom  10%
Utilities   5%
Enbridge and IPL do behave more like utilities, but the TSX includes them in the energy sector, so we do as well. Badger has 55% of its business in the oil and gas sector, but the TSX classifies it in Industrial Products. 

In the may 2014 post i cited earlier, which is for a "middle aged conservative" investor, it is like this:

May 05, 2014 (asked by paul)
Question: What sector weightings would you recommend for a conservative middle age investor, with a balanced focus on capital gains and dividends. Thanks
5i Research Answer:
On average, we would suggest a portfolio similar to this:
Utilities 15%; Financials 15%; Energy 10%; Materials 5%; Telecom 10%, Industrials 10%; Healthcare 5%; Info Tech 10%; Cons. Discretionary 5%; Consumers Staples 15%.

Q: Hello Peter & Co,
It seems that a few investors are taking some profit today in Health/Pharma & Info Tech; that's healthy as they had gained significantly lately. No need to panic and stay the course, right?
Have a good weekend,
Antoine

Q: I own a small position in Ritchie Bros (RBA). I am requesting your comments on its quarterly results released last night.
Thanks, Tim.

Q: What happened

Q: Could you please comment on today's drop in the stock? Is there reason for concern? Is this a potential buying opportunity. They have had a history of increasing dividends.

Thanks,

OV

Q: Hi Team,
Could you recommend some mid to large cap stocks with a good combination of metrics such as: high ROE, low debt, generates good free cash flow and has the ability to diversify globally. In other words the "perfect" stock lol.
Thanks, you continue to impress and should be very proud of the 5i brand!!

Q: I do not own, but am thinking of initiating a half position. Given how beaten up it has been over the last few months (close to its 52-week low, RSI around 20), would this be a reasonable entry point for a long-term hold?

Q: hi guys just starting to build my portfolio and i would like to do so by buying good stocks when they are out of favor and are cheap. i'm all about growth and have a high risk tolerance. i started by purchasing RE and SGY as they are in the most beaten up sector. can you suggest a stock each from the other sectors that's in this category,time is not a factor . Thanks Garfield

Q: Good day,

Healthy drops on each of these two companies today. Any cause for concern or just profit taking with each seeing all time highs this week? Assuming that both are held at a position size that could be comfortably expanded would you suggest buying more on the dip, holding or even reducing?

Thanks!

Q: Hi Peter, I am looking for investment in the US market, Narrower down to the above two stocks. Both offer dividends and have solid business model for some growth. Would appreciate your choice, perhaps another one you would recommend.
Regards, J. P