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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: Just joined your service and am looking to reproduce your balanced portfolio. The only insurance company I currently hold is IFC. Would you recommend switching out to a life insurance company (SLF) especially with the predicted direction of interest rates?
Read Answer Asked by Paul on March 09, 2017
Q: I would like to know which Growth Portfolio companies would qualify for the Balanced Equity portfolio and also any that may qualify for the Income Portfolio assuming there was room in each.
Many thanks.
Read Answer Asked by Martin on March 09, 2017
Q: Hello.
I have been looking for a Technology stock to enter. As per an earlier comment today, I too find prices high and given my own investor behaviour have not faired well with some of the high prices and volatility.

So looking at OTEX, would comment on some of the fundamentals. BMO shows P/e of 7.4 at current price. I have seen where you comment previously about positive position this Waterloo company finds themselves in the market. What may be expected of OTEX going forward if bought today?

If there is more you can add to buying high priced names and how to hang on through volatility, it would be great. The only way I can do this is to buy and sell on 5i actions.....which is somewhat inappropriate expectation to place on this service.

Always good responses.
Thanks
Dave
Read Answer Asked by David on March 09, 2017
Q: I recently subscribed to your service and I would like to implement your balanced equity portfolio.
I understand that the shares mentioned below may still have some growth potential and that it make sense to hold on to them if they were purchased at a lower price. However, I find it difficult to purchase them at their current price and P/E ratio.
Ccl.b $ 290 P/E ratio 30 ( went from $97 to $290)
Csu. $645 P/E ratio 49 ( went from $120- $645)
Kxs. $70. P/E ratio 127 ( went from $44 to $70)
Engh $55 P/E ratio 31 ( went from $19 to $55)

Could you suggest a replacement for each of those companies that will be in line with the strategy, asset allocation and the targeted annualized return of the balanced equity portfolio.
Read Answer Asked by Monique on March 08, 2017
Q: This is a question I sent in last week, and the answer:

Question:
I am new to 5i, and investing based on the Balanced Equity Portfolio. Some of the companies in the portfolio have B and even C ratings. Why are they here if A ratings are the best? It seems to me I should get the best performance if I only invest in the A rated companies in the portfolio. Or am I wrong?

Answer:
We needed to add other companies for diversification and balance within the portfolio. Also, there are not enough A rated companies to really provide proper diversification. One other point: a company could be rated C but still provide significant upside if the valuation is low enough to start with.

I'm looking for more details on this matter. If the response uses up several of my "question credits", that is OK.

Having started a little over a month ago, I have only bought into about six companies so far, all from the Balanced Equity Portfolio. This represents a very small portion of my total investments.

Below you indicate that B and C rated stocks are added for diversification and balance. At the moment, those factors are not important to me because I get diversification and balance elsewhere. What I'm trying to do is maximise my potential return with 5i.

According to the 5i Research Ratings, it would seem that an A stock is likely to have a higher return, with lower risk, than a B stock. So if I don't need diversification, then it would seem that over time the A stocks will outperform the B stocks. Or am I wrong?

Have you done any analysis of the performance of A stocks versus B stocks? What were the results?

As someone just starting with 5i, it would be useful to know the date you "opened" a position in the Portfolio. Is that information available?

How often do you update/reconfirm the stocks in the portfolio. For example, WCP has declined 32%. Is it likely to be dropped from the Portfolio or is it a better buying opportunity then before? On the other hand, CSU has increased over 400% and is still rated an A. With a great rating and momentum on its side, is CSU a screaming buy or is it overvalued and at risk of a decline?

Do you ever put on a "hold"? For example, I am interested in TOY, but the stock has recently had a substantial price increase. Is it still a buy, or should I wait for a pull back?
Read Answer Asked by Jack on March 08, 2017
Q: Could you help me analyse/dissect Brookfield's investment in Terra Form Power and Terra Form Global. The press release indicates a 1.4 billion $ investment by Bam.a and about 500 M $ commitment by BEP.un . Is the Bep.un portion part of the 1.4 Billion or in addition to it? Do the acquired solar and wind assets become part of the BEP.un portfolio complementing their predominately hydro-electric assets?
BAM.a is one of my largest , longest term holdings and I would like to continue to benefit from their expertise. That said, I would like to focus any additional investment on the renewable energy segment so which entity is likely to benefit most directly from this acquisition - recognizing that Bam is a growth vehicle and Bep largely an income one with some growth?
Thank-you
Read Answer Asked by William on March 08, 2017
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