Investment Q&A

Q: In response to my last question, you named VLS and XLI as possible industrial etfs. Is VLS a typo; having trouble looking it up.
Thanks for your response to that question and this one.

Q: Hello Peter & 5i team,
So far so good in 2015, even though it was a tough year ; the equities (all canadian) I own have generated a 12.6% total return to Nov 20.
But these equities represent 82% of my RRIF portfolio ; this means that I’m sitting on 18% cash which I hesitate to redeploy.
You say that the US economy is pretty strong ; well, I’m not so sure about that. It is rather the best among a lousy bunch; in other words, in the kingdom of the blind, the one-eyed is king.
The S&P 500 rally is of low quality in terms of lack of breadth ; in 2015, its top 10 performing components represent over 100% of the total whereas that ratio was less than 20% in 2014 and slightly more that 10% in 2013. That’s a bad turn of situation.
The relative performance of the Russell 2000 vs the S&P 500 is in decline due to lack of liquidity in the small cap sector (which is the engine of growth). That’s no good either.
The Retail sector (consumer discretionary), which is a very important sector in the US economy, is dominated by only 3 names : Amazon, Netflix and Expedia. That’s hardly reassuring.
The US$ keeps gaining ground ; that causes enormous pressure on Emerging Markets debt and constitutes a substantial headwind on US multinationals profitability.
To top it all, the 2-year US yield is going up contributing to a flattening of the yield curve ; if (and its a big if) this situation perseveres for a few more months, we could face an economic downturn.
This is my rationale as to why I hesitate to redeploy my cash and look forward to your counter arguments,
Thanks as always,
Antoine

Q: Good morning,

I currently hold SPY, VIG and IWO for US exposure in equal amounts representing 8% of my portfolio. Would you recommend switching to/ or adding to these the specific ETFs that you outlined for tech, consumer discretionary and industrial sectors? Also, what portfolio % might you aim for in US currently.

Thanks.

Q: goodday
In your options strategy i notice that you renew the option or sell another one about once a month. I have heard that others look out to two or three months. I have looked at calm and noticed that on a $60 strike price, you stand to make pretty much the same premium, the feb premium just paying thrr times more than the dec premium. I would like to know if there is any kind of advantage in the once per month option
Thanks

Q: Hi Peter,

This stock was suggested in the Financial Post prior to the health care correction. Would you consider it a hold? I could tax loss sell?

Thanks for the great service. I too recently renewed for two years.

Q: Hi Guys. With all the hype of 5 Star Wars releases in the next 5 years plus the merchandising to go with it. Is Disney priced to perfection at this point or does it have room to move to the upside if it starts smashing worldwide box office records? This is of course in addition to all its other upcoming high profile film releases. Not to mention media properties, parks, cruise ships etc.

Q: Team,

*Please count this as 4 questions*

Can I get your updated opinion on the following 4 US companies, all of which has had recent dips / corrections.

I own an avg. position in each as part of a balanced portfolio, thinking of adding more to each name, do you have a higher degree of confidence in any of these names more than the other? Thanks.

1. UTX
2. CSX
3. MRK
4. PG

Q: May I have your opinion on these two stocks, please. Qualcom was battered today, but has been declining for a while. At&T seems to be solid and competitively priced?
Thanks!

Q: Can you provide an opinion on this stock please and thank you...i understand you don't follow it closely but an independent opinion would be appreciated...cheers

Q: Hi Peter
Have done very well by your CDN stock picks. I know US stocks are not something you specialize in but a question. If I wanted to buy one US conglomerate (not in health care) for long term low risk growth and income what would be your top choices? Much thanks

Q: Given the recent patent infringement issues on top of difficulty in China, what is your take on QCOM? It has a very dominant position in mobile chips, but this seems to be the source of many of its problems. I remember when this happened to Microsoft in the late 1990's. The stock lanuished for years before recovering. MSFT was at a much higher P/E then compared with QCOM today, however. What are the chances of recovery? Would you recommend holding QCOM or taking the hit and selling to look for better opportunities? Any suggestions in the technology space?
Thanks,

Q: Hi guys, I have done very well with the consumer discretionary sector both in Canada & the U.S.A. My problem is that it has grown to 25% of my portfolio (each name is between 3 to 4%). What is your forcast for the sector in 2016 and should I trim now or wait until they reach 6 to 7%. Should you recommend trimming, what sector looks interesting to you to this time.

Thanks,

Jim

Q: Hi Peter and Team? I was thinking of buying some PPG industries which trades on the NYSE. I would value your thoughts on this company. Thank you for your help, Tamara

Q: With the ISIS news stories, I would think that aerospace and defence stocks would be an area to look at. Do you have a suggestions of stocks in this sector ? Are there canadian dollar stocks that you could recommend?

Thanks

PS- Love the site

Q: In your recent article on covered call writing for income you used CALM as an example. The stock is apparently heavily shorted and I am wondering was this a consideration when you chose the stock. It seems to have excellent fundamentals. Could you explain the short thesis?
Many thanks
Mike

Q: Pfizer is planning to merge with Allergen & move head office to Dublin ---Inversion Tax laws in US --come into play . Question ---How likely this will occur & do you think it will affect the deal & stk $
Thanks ---don

Q: After the spin off from ebay and the acquisition of zoom what do you think of PayPal as an investment specifically is it reasonably priced as a growth company?

Q: Good morning,
I read your response to the recent GE Election offer to exchange $100USD GE shares for $107.53USD Synchrony Financial shares and given your comment, I will likely retain my GE shares.
This being said and prior to reading your response on the GE Election Offer. I was considering the tendering of my GE shares to benefit from the 7% immediate premium, sell the Synchrony shares at the earliest opportunity to lock in as much of the 7% as possible and then buy back the GE shares at a later date, hopefully at a lower price than I tendered them for. I'm sure that if it was that simple, everyone would be doing this, but I am curious to understand and hear from you why this would not work. Thank you.

Q: Hi 5i Team!

What are your thoughts on Walmart (WMT) and American Express (AXP) current valuations? Are they cheap, fair value now or value traps to advoid?

Thanks, Shane

Q: Could you update your thoughts on Encore Capital - once again, a very solid quarterly result and yet the stock is dropping quite substantially (last update July/14).
Thanks,
Murray