Investment Q&A

Q: Dear 5i Team,

Several ETFs like HHL and EIT use a covered call strategy for portions of their investments. When markets have an overall downward trend, or are otherwise directionless but volatile, is this an effective strategy? I know that it works in an upward trending market but wasn't sure about the other scenarios.

Thanks in advance!

Derek

Q: First quarter earning reports are due out soon. They wont be great because of March. The second quarter will be far worse with only essential service personal working. Yet there is a huge two day rally happening right now. Is this a smoke screen and with it likely come crashing down during these reporting cycles.

Thanks Steve

Q: Seems to me right now that buying either one could be risky idea.
I would think there is a Tsunami of foreclosures and Bankruptcies looming as we
get deeper into the Covid crisis .
Can I have your thoughts on this?
Thanks

Q: You have recommended buying into the market slowly over several months, perhaps small cumulative positions in individual favorites, or a diversified etf. I'm wondering how many earnings shocks we will see that may offer an opportunity to 'jump in' to an individual position. Are you expecting such opportunities to arise or do you think recent lows have already baked in those expectations. An example might be Goose, which has been hammered and looks attractive, but could it get worse when it reports.
Thank you for guiding us through the storm and helping quell the emotional turbulence of an individual investor.
Peter.

Q: Hello, do you know any web site tracking the recent dividend cuts ?

Q: Dear 5i
A couple weeks ago i sold an ETF for a loss . A few days ago i inadvertently bought the same ETF back though not the same dollar value . In this situation have i lost the tax loss claim for accounting purposes and if so is there any way of getting it back ie re selling again the same ETF i just purchased a few days ago ?
Also i`ve opened up 3 RIF accounts ( mine, my wifes and her spousal ) .
I plan on transferring our RRSP monies from each of our RRSP accounts into the corresponding RIF accounts but only for what we need to live on for that year (for tax reasons ). This amounts to about $16k per account .
My question is how should the $16k per RIF account be invested considering that about $4k will come out from each account every 3 months (staggered withdrawals ) ? The bulk of the investments will still be in RRSP`s and it is these accounts that can be fully invested ( when the time comes re the virus ) .
Thanks
Bill C.

Q: Good morning, with current market turbulence does 60/40 index investing formula still make sense or is one better investing is good growth stocks for the long term?

Q: With the slow down of the economy during this pandemic investors who depend on dividends to supplement their income are worried about dividends cuts and/or suspensions.
In an article in this morning's Globe the writer said: "For dividend investors looking for bargains, there is a lot to choose from".
Could you perhaps list (10) dividend stocks where you think the dividend will be safe.
What sector(s) would you advise investors to focus on at this time? The stocks need not be paying a dividend.
Looks like I have 2 questions.......

Q: Hi All at 5i!
I read an article by Jeff Booth entitled” Jolted awake from an economic fantasy “, in the Globe and Mail on Saturday. Basically, Jeff gave an example of a saver and a person who took on a large quantity of debt and kept doing so. In 2008 , when there should have been an economic reckoning ,the Saver was punished , but the indebted person was rewarded by the government pumping liquidity into the market, thus fuelling the economy with even more debt, and not allowing things to fail as a capitalistic market would dictate. So now, with this virus, and more government indebtedness, to help the country, where will this leave us? Will we be kicking the can of economic collapse further down the road? I am just trying to figure out the economic implications of all this, with my limited insight, as economics is not my area of expertise and I am getting a headache. I was hoping you could comment. I am heading into retirement, and am just wondering how I should position myself to safeguard my savings ...the market is unstable and the GICs are punishing the savers...again. Thanks, Tamara

Q: I have numbe rof companie on my watchlist.and number off companies I own not tracked by 5i-
byd bam aqn ecn kxs atd ccl gib .a. recently I deleted number of companies however I don't know how to add.
i am tech illiterate can you tell me how i add

Q: Are there any tsx listed medium and large cap companies that incur most of their costs in Canada but most of their revenue in the US? I ask because those companies may get a bump in revenue and profit because of the low cdn dollar/high us dollar.

Q: Dear 5i,

Can you provide some ideas where one might invest some cash if we have negative interest rates.
Should we be borrowing money to take advantage of negative interest rates?
Do you think negative interest rates would inflate the Canadian real estate market prices?
What observations have you made from European negative interest rate policies?

thanks

Q: What is your opinion of the mortgage rates which are rising as the Bank of Canada cuts rates down to .25% and bonds are also losing ground ? We are due to renew our mortgage in 3 weeks and are very concerned that the current pressure from mortgage deferrals re covid19 is causing the banks to raise rates for those of us that are financially strong to offset the costs of covid19 costs. Will the government allow the banks to not only refuse to pass the reductions in interest to consumers but also raise them ? Please advise what your thoughts are.

Q: Hi Guys
a bit of a conundrum here, i came into the crash with 45% cash hoping to buy some U.S. stocks, but the low CDN dollar is making me question whether it's worth it. I'm usually a long term holder, buy U.S. stocks for their dividend growth over time. Whats the most you would be willing to pay for a U.S. dollar when buying U.S. companies, my thinking is around $1.40/ $1.41 is this to high?
thanks Gord

Q: Hello Peter
Has the covid 19 fully or near fully priced in the market? I look at the log graphs for new cases and deaths and it is still on the rise.
Is the market in North America forming a base or is there another sharp leg down coming? What is your opinion?
Regards.

Q: Hi hope your can help - when the btm fell out of the market I had $1.3 million in stocks presently sitting with $800 (90 % cash) - did not start selling until the market hit 20,000 on the Dow then it was a race to the btm needless to say I also missed last weeks rebound question is how to go from here to start to rebuild. I am retired so too much risk would not be desirable PS I have enough in another retirement account ($500,000 to last 5 yrs Any help you can offer would be appreciated

Q: I had trouble explaining tax loss selling to my sister. If I sell a company for a tax loss and buy it back in 30 days and it goes up I have a capital gain that I will have to report sometime that I would have to use the capital loss to cover offset. Tax-wise wouldn't that be the same as not doing anything? That would also be the scenario if I bought a parallel company that went up in a similar manner to the one I sold.
I always hope to have a capital gain on something so the capital loss may come in handy but in this market I probably won't be using the capital loss anytime soon so the tax savings is a bit theoretical. As near as I can see the only way to come out ahead is if I sell a company that is down and buy a similar company that is also down but likely to recover more or faster than the one I sold. In other words, sell a lousy company and buy a quality company. But then should I be doing this all the time anyways. I'm not too sure that I can reduce my taxes in the long run. So I am just standing by in a holding mode hoping for better times because I liked the companies that I had before all this craziness although I don't like the losses. Only if I have or recently had a capital gain is the tax loss selling worthwhile Does that sound about right or am I missing something.

Q: Follow up question on Depression
Do the interest rate and unemployment goes up or down.

Thanks for your great service

Q: Thank you for Portfolio Analytics. I have found it a quite helpful. Last year it was a very timely wake up call for me to make adjustments to the portfolio and allow for higher fixed income exposure and better geographical exposure. Thanks again in your guidelines

Q: Hi there,

The market has rallied hard over the last 3 trading days. Still it is far off from the all the highs when looking back. In your professional experience and years of investment experience, can you comment on where you think the market goes from here? Do you think this is a head fake / bull trap and we are heading lower in the coming months and there will be better entry points over the next 6 months? I've heard more people say U shaped recovery, and a couple saying V shaped. What is your positioning on this? It would great to hear your perspective on the current market and where it might go over the next 12 months.

Thanks!