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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 have 25% in fixed income in the above ETFs. In my TD account they are all showing a small negative return. Wouldn't cash be better or a GIC. I would really like to understand the logic of holding these rather than say a GIC. Thanks so much.
Read Answer Asked by Danny-boy on June 18, 2018
Q: Hi 5i,

I need to create a fixed income allocation in my LIRA. Would you recommend an equal allocation to the following ETF's: CBO, XBB, ZEF, CPD and ZHY? If not what would you recommend for a fixed income etf position.

Thanks,
Read Answer Asked by Christopher on June 18, 2018
Q: Hi 5i,

Need to create a new fixed income/bond position in my portfolio. Looking to allocate holdings (equally?) across the following ETF's: CBO, XBB, ZEF, CPD, and ZHY. Would you recommend this as a good long term strategy or would there be a better ETF combination you'd recommend.

BTW loved your May issue in ETF Fund Update (etffundupdate.ca) on balancing sector allocation.
Read Answer Asked by Christopher on June 18, 2018
Q: Hi 5i. FI = Fixed Income

My (6) FI holdings with rough total returns (including MER & dividends) for period held (average ~ 1.5 years): CBO -1.3%, CPD +15.0%, HFR +1.7%, XBB -2.2%, XHY+5.5%, LQD -0.6%.

NOTE: LQD not selectable, so picked HYG for question above.

Question: I understand the reasoning behind having the above FI holdings in my portfolio, but holding CBO & XBB seems like a sure way to lose money. So why not move CBO & XBB holdings to HFR (and possibly also XHY) which at least returns me ~ +1.7% pretty reliably? Your opinion on my FI mix would also be appreciated.

Thank you for continued solid wise advice.
Read Answer Asked by Paul on April 10, 2018
Q: I currently hold this Bond Fund. I'm looking to add a bit more fixed income. This fund is well below NAV right now, has declined about 2.8% in the last year (most of this in the last month or 2), but has a nice yield of close to 6%. I am up on the year by 3% which seems fine to me, considering savings accounts pay .05% these days. Should I add to this one or are there others that might grow a bit in this environment? It seems most of them are well below NAV at the moment. Thank you!
Read Answer Asked by John on March 12, 2018
Q: Hello,
The return of these etfs has been lower than usual in 2017, I suppose mainly because of the increase in interest rate ? What annual return should we expect over the next few years for these 2 ? Which one is your favorite and/or would you have an alternative (risk adjusted return). Thank you !
Read Answer Asked by Pierre on March 07, 2018
Q: I keep reading the traditional fixed income portion of a portfolio that has been allocated to bonds in the past, is a bad idea as a long term investment going forward. With that being said, what type of investments/products would you suggest the average investor allocate the fixed income portion of their portfolio going forward?
Thanks
Read Answer Asked by Curtis on March 04, 2018
Q: I have 1583 shares of CBO @ $19.48 now at $18.43 (3% of portfolio). for a loss of $1664. Dividends are now $552 / yr. I also have 3881 shares of CLF @ $18.57, now $17.84 (6% of portfolio) for a loss of $2838. Dividends here are $1560 / yr. It seems that I am just reading water and I am getting worried of drowning as the ETF's keep dropping down a bottomless pit. I am 71 with 50/50 equity / fixed, the fixed including a GIC ladder and otherETF's. Should I stick with CLF and CBO or is there a more advantageous alternative.
thank you
Stanley
Read Answer Asked by STANLEY on February 27, 2018
Q: I am managing my 83 year-old mom’s TFSA ($64,000.00) and Investment Account ($25,000.00). She contributes $6000 yearly ($500.00 monthly) to the Investment account and $5,500.00 to the TFSA.

I am thinking of purchasing the Mawer Tax Effective Balanced Fund (MAW 105) which comprises 30% Canadian Fixed Income; 2.5% Global Fixed income, 7% Cash, and 60% Equities (Canadian, US, and Global) and a ETF Bond Fund such as Ishares CBO. What percent of each would you suggest I purchase of each or should I just purchase MAW 105. She doesn’t need the money for spending. Any other suggestions are greatly appreciated. Thanks. Susan

Read Answer Asked by Susan on February 20, 2018
Q: I am needing to increase the fixed income portion of my asset allocation after a good run by equities, which I thank you for. For fixed income I am using a mixture of GICs and the PHN Total Return Bond Fund (RBF1340) because it has a low MER. Would it be imprudent to add to a bond fund at this time of rising interest rates and is there a better one I should consider.
Read Answer Asked by jane on February 08, 2018
Q: Can you recommend 2 or 3 bond funds in Canadian $ that would be the least volatile and offer a return for a 3 to 5 year hold? I would prefer one Canadian and one U.S. or international. This would be my sole fixed income holding. Thanx
Read Answer Asked by Steve on February 01, 2018
Q: I have owned these Bond ETF's for the last few years and have seen the unit prices drift lower with the rising rate environment. If I had bought the bonds directly the maturity date would restore the capital. Does the same thing happen within the ETF's to the same effect? How doe s it play out over time?
Thanks
Paul
Read Answer Asked by Paul on January 29, 2018
Q: I am currently using 1 year term GIC's for my fixed income portion of my portfolio. I don't need income and looking to maximize my long term total return (i.e. 10 years or more) with low volatility and relatively low risk of loss compared to equities. Can you please provide me with a few alternatives? I am thinking ETF's might be the way to go but I am open to your suggestions. Thanks for your wisdom.
Read Answer Asked by Rino on January 22, 2018
Q: Dear Team:
I have been retired for 5 years now and have been self investing with a return of 13.58% on average. I have reached 60 years and feel that I should have more fixed income as of right now; I have about 12% of fixed income. My portfolio size is over $1M. I have 2 questions for you:
1) Do you think I need more fixed income?
2) If I was to increase my fixed income, I am thinking of an ETF for either Re-set Preferred Shares or Short Term Corp Bonds or Real Return Bonds. Which do you like?
Thanks for your time
Jim
Read Answer Asked by James on January 19, 2018
Q: Good afternoon team
I’m looking to add to the income side of my portfolio and already hold 10-15% of ZPR and CPD.
I’d like to add another 5% to the income side of my portfolio so which one or two options do you advise?
I’m looking for more income with little or no growth as my equity weighting is fairly high in dividend paying stocks as well as growth stocks already?
Thnx in advance!
Read Answer Asked by David on January 18, 2018
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