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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 presently have $150,000 in MMF19. It has a MER of 1.5% and has yielded about 3.5 % annually over the past two years. PMIF has a MER of 0.75 and the indicated yield is 4.6% while PM0205 has a MER of 0.75 and a yield of 3.94 %. Would you sell MMF19 and buy one of the PMICO funds as a replacement? Would you have an even better suggestion?
I'm 85 years old with no need for income but I want to reduce risk by holding some bonds.
Read Answer Asked by George on January 22, 2018
Q: Hello 5i,
My wife has a very small LIF (around 1% of our PF value) which was put into RBF461 A. Initially it generated enough income to almost cover the withdrawals, only a minimal amount was needed to be sold. The last year, however, has seen the fund return very little and more has needed to be sold to cover the annual withdrawal.
I was contemplating switching the LIF to XTR which would seemingly generate far more income and require a smaller amount to be sold. My questions are:
1. Would you endorse moving out of the RBC mutual fund and into an ETF?
2. If so, would XTR be a suitable candidate or would you recommend something else?
We currently have (5) pensions and an equity portfolio which also has some fixed income in it (@15%).
Thanks for any direction you might be able to provide.
Cheers,
Mike
Read Answer Asked by Mike on January 22, 2018
Q: Hi. Peter and 5I.
I have also, as Carl, noticed the significant increase of questions on ETF's. This is one of the numerous red flags that are started to pop up all over the market universe in my opinion.
I have taken action against what I consider a risk reward more and more tilted to the downside and am way more concern today about terminal losses (unrecoverable losses) than I am about simple losses on further potential gains(opportunities costs)
I consider ETF's to be purchased only where I cannot buy company stock in certain asset classes or I need to buy in a foreign market that reflects a potential opportunity.
I have a general question about ETF and how they work. If ''everybody'' is buying ETF's now, does that means that the underlying stocks will also grow no matter their intrinsic value. In other words, would it be possible that the ETF's buyer may have now a predominant impact on the market than ''all'' the direct buyers of the underlying stocks. Tail wagging the dog kind of...
A comment on the extract from A wealth of common sense that you mentioned.
If the 16000 mutual fund are buying ETF does that not add to the overextended existing situation?
Passive investing is not just the domain of retail investors.
Thank you
CDJ
Read Answer Asked by claude on January 22, 2018
Q: Do you have any thoughts on the new ETF "Redwood Behavioural Opportunities Fund"?
Read Answer Asked by chris on January 22, 2018
Q: I am a retired, conservative, dividend-income investor with a pension, CPP, 30% fixed income (annuities, Fisgard Captial) and 70% equities (14% MFs, 16% ETFs and 40% mostly blue chip stocks). The question relates to the performance of 2 of my remaining MFs, those being Sentry Cdn Income and Sentry Global REIT. I receive a 6% dividend on my ACB for both of these, which I am very pleased with.

SC Income = held it since 2011 and have a total annual return of 9.7%, which I am happy about. However it is not performing well the last few years. Is it simply the portfolio was positioned poorly (in hindsight) at the wrong time? What is your impression of management?

Sentry Global REIT = held it since 2012, did well initially but recently only returning 2%/yr. I sold some last year and now have a half position. Again, your comments on sector performance and quality of management are appreciated.

Thanks...Steve
Read Answer Asked by Stephen on January 19, 2018
Q: For diversification I would like to buy a global fund. I have quite a few GICs. but they are still trying to sell me Edgepoint Global Growth and Income. I wondered if Edgepoint Global Growth would be better. since the GIC make up my income portion of my portfolio. I think the MER is the same for both funds, so I am paying a higher fee for the bond portion.
I appreciate your opinion.
Shirley
Read Answer Asked by Shirley on January 15, 2018
Q: Hi & thank you for continued sound advise.

I'm a Balance/Growth Investor with ~ 30% Fixed Income.

- Current Fixed Income: XBB (30%), CBO (40%), CPD (15%), XHY (15%).
- Planned Fixed Income: MMF659 (70%), CPD (15%), XHY (15%).

Reasons for change:
- Tired of poor returns of CBO, XBB.
- Want more diversifies (USA, INT) fixed income securities.
- The ~ 1% MMF659 MER seems worth it based on 6.23% compound return since inception [2005-11-25].

Haven't held a Mutual Fund in 8 years, but... Yours thoughts would be welcomed here. Thank you!

Paul
Read Answer Asked by Paul on January 09, 2018
Q: Is it worth getting rid of all these mutual funds? . Are they as bad as they look? Account is for a early 60s couple nearing retirement

Do you have any mutual funds or etf recommendations for replacing these? Maybe just keep Mawer balanced fund

Thanks


MAW 104 .
.Mawer Balanced Fund Class A
.

Fidelity Monthly Income
Class Series B .
FID 416


Fidelity Canadian Large cap  Fund  
FID 231  

Fidelity Monthly Income.  
FID 269


Invesco Select Canadian Equity Fund.
.AIM #1581.


CIBC Balanced Fund . Cib 901

Ci Signature High Income Fund.
Cig 14014

Sentry Conservative Balanced Income
Nce 534

Templeton International Stock Fund.
TML 705.

RBC Select Balanced Portfolio Series
RBF 460
Read Answer Asked by Thomas on January 09, 2018
Q: Hi Peter and Ryan,

I am wanting to invest in emerging markets and I am been comparing the mawer fund for emerging markets with a mer of 1.60 to VEE the etf, with a mer of .23.
Is the high mer worth it for the active management?
Other aspects of these options that I have been comparing is the holdings, Maw160 has 36 holdings and VEE has 4726 ,tracting the index.
Do you have any other suggestions for emerging markets?
Thank you for this valuable service,
Susan


Read Answer Asked by Susan on January 08, 2018
Q: At present my TFSA is composed of MAW120/MAW150 at a 60/40 split.
I can keep this and add 1 stock this year. If that is the case which growth stock would you recommend?
Or should I sell and buy a 5 growth stock portfolio? What 5 stocks would you recommend?
The reason for the MAW funds in the first place was to increase my international exposure since I was mostly in canadian funds overall. I have now rebalanced my portfolios and have my international exposure needs met elsewhere.
As always your help is greatly appreciated.
Read Answer Asked by Anna on January 05, 2018
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