Investment Q&A

Q: I have access to Morningstar through the broker. Morningstar’s analysis is often useful, but its ratings of companies covered are puzzling. Nuts, actually. A business starts doing better than ever and its shares rise as investors come to appreciate the rising value. Just at that moment, in comes Morningstar with its downgrades. It beats up a company performing very well by downgrading the rating of companies whose results are improving to Hold or Sell. Conversely when a business is stumbling badly and its shares drop, up goes the rating from Morningstar. One understands when analysts downgrade and explain that they still like the company but that they feel they need to go from Buy to Hold on the grounds of valuation . I have not seen Morningstar explain their ratings in a similar manner. If one reads Morningstar’s narrative, is it best to ignore its ratings? This is after all what one tends to with “target prices”. Or, am I missing something important?

Q: Just a general question. With markets at all time highs, but the virus is still a big part of our lives. While the market is forward looking, a lot of damage has been done. In addition, this would be the first recession with only 1 wave of selling as opposed to multiple waves. Do you think there are near term risks or are we just headed higher and try not to overthink it, but leave some cash on hand for future opportunities? How much cash? 20%?

Thanks,
Jason

Q: Hello Peter,
I would like your opinion.
I have about a 4% position in Gold and silver stocks and have been planning on doubling towards the end of the month before the seasonal period around Christmas to Chinese new year.
I was also reading today a Bloomberg opinion that calls for an end to the bull run. And the thesis is as follows:
1. The availability of vaccine 2. A republican senate that would put a lid on stimulus spending. 3. A stabilized US dollar perhaps even strengthening. 4. Inflation? Here I may go with a probability more than 50%
Do you think it is appropriate to double position in stock and bullion to 8 percent?
Regards
Rajiv

Q: What are your thoughts on new TLS ipo.

Thanks
Hector

Q: I am in my early 80's ,have large capital gains and plan to stay invested in equities as my parents lived to over be over 100.
I believe that the capital gains inclusion rate will be increased to 75% as early as December 31,2021 which is 50 years since the capital gains tax originated.
As a result I intend to begin selling the equities with the largest gains with a view of buying a portion of them back after leaving enough in cash to cover the tax.
Can I repurchase the same day or do I have to wait until after the date of settlement?

Q: Dear 5i
Between my wife and i , we have 3 RRSP and 2 TFSA accounts and 1 unregistered account .
In terms of stock picking for each account how would you go about choosing your stocks based on having 6 different accounts ?
For example i`d like to own 1-2 utility stocks per account and maybe 1 bank stock per account . Would you say that i`d be better picking a different bank / utility stock for each account OR just pick the 1 or 2 of the best stocks per category and have the same "best " stocks in each account ?
Thanks
Bill C

Q: Is there any advantage/disadvantage to buying a US listed stock in your Canadian RRSP account as opposed to buying US dollars and buying the stock in your US RRSP account?

Thanks for being such a great source of information.

Q: I am ussually not a holder of cash in my investment accounts. I have moved to about 15% cash by cleaning up some dogs and selling some assets that bounced back post march crash. The recent run has given me FOMO. My brain is telling me that the markets are crazy and there is no good reason for this recent run, the but the market is alway right. So I sit here asking myself "Am I acting like Trump or are the markets acting like Trump?" ....So my question is: if you did a 5i office water cooler poll how many think there will be a major second correction in next 4-6 months: never, unlikely, likely, 100%.

Q: Good morning folks, I would like some food for thought regarding a TFSA. Over time my TFSA has morphed into a Tech account which isn't so bad given recent sector performance. I am generally pleased with overall portfolio balance but feel that some diversification in my TFSA would be advisable. Would you please suggest which sectors (ranked if appropriate) are best held within a TFSA with a bit of colour commentary. Thank you so much for your input. I find the Q&A section truly great brain food. Have a wonderful weekend!

Q: What worries you about the economy today.
Clayton

Q: Have you ever of this company (worldmarkets), are they available to Canadian Clients, and what do you think of their published performance, it looks unrealistic. Thanks
https://worldmarkets.com/aimanagedaccount.html#account-safety

Q: Mott Capital U.S. (a guest on S.A.) commented on Nov. 11 that in reality the point of no return for high flying tech stocks may be here. Do you feel this is a fair comment? I greatly respect 5i's opinions and information received.
I was logged into 5i a previous guest was trying to find some information and it was mentioned something to do with the footer. Where would I find this footer? In times like this it is good to have 5i on our side.
Thank you.

Q: Hello,

As it pertains to trading in a TFSA account, I recall an answer to a question where you felt that 4 to 6 trades a month may pass muster with Rev Can.

Is there a way of seeking clarification from the Rev Can so that one is apprised, or does that just draw attention to oneself?

Q: Investing can be such a joy at times (sarcastic). I set a target price to sell GC knowing it had debt/investigation/no dividend, and covid numbers rising. That target price hit on Tuesday and I sold. What a pleasure to wake up Wednesday to see a big jump from a takeover bid. Man did I ever time that perfectly!
Paul...grrrrrrrr :)

Q: I am helping my niece set up with ETF. She is holding the below funds right now. Can you please advise their fees and which ETF would you suggest replacing them with? Is there a site where you can check the mutual fund fees and performance?

PH&N LifeTime 2045 Fund
RBC Canadian Equity Fund
RBC Balanced Fund
BLK Balanced Index
Capital Global Equity
BLK US Equity Index

Thanks for your help
Hector

Q: Hi, Just a general question about Market Call guests. Do they approach BNN about appearing on the show, or does BNN aproach them about coming on the air. It looks like fantastic exposure for attracting business
for the individual and their firm, thanks?

Q: What source do you use to assign a "Sector" label to a specific company? Do you group similar sectors under your labels? Can you elaborate on the process you use in your portfolios?

I attempt to apply sector labels to individual companies in order to track sector weightings and maintain an awareness of the level of diversification I am achieving.
Keeping the number of sectors to a reasonable number (10?) requires grouping of stocks.

Currently I am using ; Consumer C/NC (10%), Finance (20%), Health Care (10%), Energy (10%), Industrials (10%), Technology (20%), Telecom's (10%), Utilities (10%). Industrial's and Consumer C/NC usually get a mix of companies thrown in there. The weightings are my loose guidelines, and I do vary from them quite a bit. i.e. Energy is currently at 3%, Tech at 40%.

I have a struggle controlling the Tech weighting due to positive returns of my holdings and the fact that so many innovative companies use technology in conducting their business and thereby are classified into the Tech Sector. (E.g. REAL is within the real estate industry however is placed in the Tech Sector.)

Any thoughts you can offer to provide me with a healthy perspective are appreciated. Thanks.

Q: On November 10, Patrice asked about a list of dividend paying stocks; your answer provided a link to a list you had prepared. Is this list available on the website? If so, how do I access it - I looked and cannot find it. Is there other kinds of info that is available to your members and if so, how can it be accessed?
thanks

Q: My apologies for the barrage of questions today but I’ve been saving them up meaning to get to them over the past few weeks. This is the last one (for now). In evaluating a growth company in the small to mid cap range what would the most important metrics to use. Thank you.

Q: Hello 5i,
Where can I find a list of companies that have just started paying dividends? This has been spoken of before that one should keep an eye out for these companies but I am unable to find a stock screener that offers this option. I am only interested in Canadian exchanges traded companies.

Thanks
Pat