Investment Q&A

Q: During this downturn in the market I believe 5i said it could be a V recovery. At the rate we are going we should be back to normal very shortly. I read 5i questions and write a lot of answers pertaining to me over the years. Do you see this recovery going at this rate or will there be a noticeable pullback? Thanks Dennis I really rely on your service

Q: Hi everyone,

I hope everyone at 5i and their families and friends are healthy and getting through the quarantine period.

I have a question about building positions. I assume its generally accepted that a full position is a 5% weight. Do you recommend sticking to full positions (5%) and half positions (2.5%) or can you build positions at 1%, 2%, 3%, 4% and 5%. Assuming a 1% position might be a junior gold miner, a 3% position would be something like Suncor, which is a good company, but volatile because its based on the price of oil and a 5% position being a stable, blue chip like BCE? Is it ok to look at it this way or does it make things too subjective and its best to stick to full positions (5%) and half positions of (2.5%-3%) and perhaps avoid some of the more speculative investments that would be a 1 or 2% weighting. If you're not comfortable holding 3%, maybe its not worth the investment?

Thanks,
Jason

Q: If you hold the same stock in both a registered and a non registered account and sell both positions within a day of each other, does the superficial loss rule apply to the registered account if you want to repurchase that stock in the registered account?

Q: I thought this link was a pretty good picture of what historical collapses have look like. Post if you think it might help those concerned about what the market is doing.

https://www.msn.com/en-ca/money/topstories/how-the-current-stock-market-collapse-compares-with-others-in-history/ss-BB11FfpW?li=AAgh0dA&ocid=AARDHP#image=2

Q: Can you please advise what happens during the depression. Which sector performs the best.

thanks for the great service.

Q: I have few questions regarding preferred shares. Many solid companies ''before covid19'' have preferred shares over 8% div. If that rate is OK for me for long term even without price appreciation, how safe will you quote them in general? What is the risk associated with that investment? Will you favor ''retractable'', ''rate-reset'', ''perpetual'', ''fixed-floating'' or ''floating rate''? How to find the term of a specific share?
Thanks a lot

Q: Do you have a break down how much did your model, growth and income portfolio went down from all time high in February compare to TSX and SP500.

THANKS FOR THE GREAT SERVICE

Q: I was reading your answer to Dennis about fixed income bonds from banks. I know very little about CBO and Bank bonds but asssume they are near risk free. Do you think there is an arbitrage opportunity in borrowing on a secured line of credit to buy a bank bond? Any particular bond that you can suggest and can they be bought on online self directed brokerage accounts with Canadian banks?
Regards

Q: I have asked a question today and here is another question that is related and comes with the same caveat that i do not know much about bonds/debt/fixed income; beyond the basics.
From what i saw on TV, the selloff in equities would force pensions to sell debt.That should depress the corporate debt prices? The central banks would buy mortgage backed securities. Who would purchase corporate debt, specially high yield? Would that also make the fixed income bonds issued by canadian banks more attractive(cheaper)? Would it also indicate that equity selloff is near bottom or reached bottom?
Would you prefer to buy bonds/debt or equity when there is a little stability? And could you please suggest some?
Thanks.

Q: My queston is regarding the U. S. dollar. Why does everyone keep flocking towards it during times of crisis when they have such massive, massive debt, thanks?

Q: if. you had to pick 5 stocks that you are familiar with and understand to start picking away which would they be.
i bought some ry at 80 and intact at111 and some suncor, just small amounts.
a value your opinion.
and is goeasy dead in the water, what a trashing

Q: On fundamentals (yield/PE revenue ..etc have we reached the levels of 2008 financial crises in particular for banks/utilities and REITS. Can you please explain if majority of REITS in particular residential (eg CAR.UN) would benefit from lower interest rates why are they going down?

Thanks

Q: So having been through the Great Recession and now the cornea virus, I finally get it. Review your portfolio ,sell those companies whose fundamentals are damaged and possibly beyond repair ( swallow the loss),deploy your cash after things have settled down and there is more clarity into stocks who have the potential to rebound much better than the stocks you have sold. Is that about it?

Q: hi,
can I get your best ideas for a long term investor ( who enjoys dividends with some growth ) for the following: (Canadian equities if possible please ) home improvement, Pharma, health services, REITS, drugstores, railways, and any other areas that you think should do well moving forward with covid19 looming over us for the next while...
cheers and stay healthy everyone. make sure to get outside and get lots of exercise! chris

Q: Hi Peter

What % breakdown would you suggest for Horizon portfolio in cash account under current situation for new money. ( I currently have 50%HXCN/ 25%HXS/ 25%HXQ)? or suggest any changes. I don’t like bonds.

Thanks

Q: Dear 5i
With the recent chaos in the markets i had gone to mostly cash but kept the bond ETF`s ( CLF , CBO , XBB , ZAG ) , only to watch them go down quite a bit as well . It's a bit concerning to think that i was well protected to the down side ( at least i thought i was ) , only to see bonds go down . You would think with interest rates going down ( generally good for bonds ) bond yields going down that bond prices typically go up . But such haven`t been the case . In light of all this should i be temporarily reducing my bond exposure or is the worse over do you think for dropping bond prices ?
Would appreciate your insight .
Thanks
Bill C.

Q: Hi,

A general question about a companies responsibility to update investors with respect to their business. Occasionally, companies update the market with respect to upcoming earnings and will 'guide up' or 'guide down' depending on what is happening. In light of the current chaos, it seems to me that now many companies have not updated guidance (I could be wrong, I follow the market generally...). Could you shed some light on to why not many companies have issued guidance updates? Perhaps the situation is so fluid, companies really can't update b/c they can't update with reliable numbers, or they are afraid to (make a terrible situation catastrophic), or...?

Further, are there time frames on issuing updates (X weeks before next quarter, for example) or perhaps requirements for updating if forecasts are going to be massively missed?

I'm basically wondering what to make of the few corporate updates.

Cam

Q: Investing in this market:
- You mentioned in a recent answer that one should buy slowly into this market. What constitutes "slow"?
- You mentioned in the same answer that shares down 40% can drop another 40%. Has this ever happened overall in a bear market other than 1929?

Q: Good morning guys:
Just like every other investor my stocks in my tfsa are down big time. I have not sold anything as of yet and bought Boyd and MasterCard for my cash account with the recent dip . I know investors should stay the course and not sell quality companies , but just like 2008 it took a long time to get our money back that was lost . That being said is it a better move to sell all my stocks in my tfsa and take the loss . I take the remaining funds and buy quality companies that have been hit big time like a Disney , mastercard , visa , Boyd for example . I presently own 10 stocks in my tfsa and they are all equal weightings. Could you please elaborate what an investor should do in this situation
Thank you for great work .
- mark

Q: Hi,
Could you elaborate on " Implied Price Return" on your companies report.

Best,
Matt