Investment Q&A

Q: In the current interest rate environment what bond ETF would you recommend as a core bond holding in an RRSP. Time frame would be long.

Q: 1. In a rising interest rate environment is a convertible bond fund better to hold than other bond funds like xbb, cbo or clf?

2. What would you suggest for the best combination of protection I.e safety and income?

Thanks.

Q: Good morning 5i
I can identify with Neil, who wrote about buying bonds at this time and finds them going down and also looking for an alternative. I have no bond allocation, either, and a couple of months ago bough BSV:US, just putting my toe in to test it. Like Neil, I am also down a little, even after the payouts.
So, I have been wondering whether it would be a reasonable strategy to wait this period out. Would it make sense, for instance, to buy something like FLOT in the US in order to do this? If so, is there anything similar in Canada, as well?
thanks

Q: I have never held bonds only equities. About a month ago bought xbb and xhy, now 15% of my holdings in my portfolio. I'm down about 2.12 % in XHY and about 0.7% in XBB in a very short time. Please tell me why I'm holding these bonds. When I can typically expect them to gain or lose; What sort of insurance/protection they offer me if that is the right word.

Q: I am contemplating selling some or all of my position( $17k, 8% weight in my RSP) In XBB in hopes of climbing the ladder a bit in yield & the possibility of some growth, while keeping the risk factor somewhat the same or perhaps a tad higher. My RSP is reasonably well diversified. Could you recommend a couple of ideas, or just stay put?
Thanks,
Ted

Q: Hi & thank you for continued sound advise.

I'm a Balance/Growth Investor with ~ 30% Fixed Income.

- Current Fixed Income: XBB (30%), CBO (40%), CPD (15%), XHY (15%).
- Planned Fixed Income: MMF659 (70%), CPD (15%), XHY (15%).

Reasons for change:
- Tired of poor returns of CBO, XBB.
- Want more diversifies (USA, INT) fixed income securities.
- The ~ 1% MMF659 MER seems worth it based on 6.23% compound return since inception [2005-11-25].

Haven't held a Mutual Fund in 8 years, but... Yours thoughts would be welcomed here. Thank you!

Paul

Q: Good morning from the West Coast.
Merry Christmas and a Profitable New Year to all the staff at 5I.
My question : Is there a CDN ETF that has a monthly payout please?
Thanks
Rick

Q: given current markets, what percentage of the above etf's would you hold for fixed income...thanks.

Q: Which of these two would you recommend for an investors fixed income portion of an overall balanced portfolio?
What second fixed income ETF would be good to pair with it?

Regards,

Robert

Q: I have a fairly significant position in XBB, but I am not certain exactly how bonds work. I took the position as an alternative to cash. The price has dropped, but with the yield I'm probably about even. I noticed you said at in one answer that there is a broad shift from bonds to equities underway. I wonder if XBB is the best place for me, as I think the bonds held are longer duration. But I understand they are high quality. Maybe I should switch to a laddered bond ETF if you recommend that, to be participate if we see rising rates. If the stock market corrects, do you think the XBB share price will rise, or will it just go down with the market correction? If my XBB will rise in a market correction, maybe I should just stay put, as long as I don't keep losing on the share price too much. Sorry for the somewhat convoluted and confusing question. Any comments will help. Thx

Q: Hi 5i
I am heavily in financials 32% am working to diversify in my portfolio. I have listed a number of my invested companies. Investments are in Can. Cash, TFSA & RRSP heaviest in (RRSP)
I would like to re-invest in divided stocks and 2 ETFs. can you advise which would be best replaced and list a few that are in your top considerations.
Thanks,
Scott


Thanks, Scott

Q: A book I am reading says that the nominal return for bonds going back to 1928 is 4.9% represented by 10-year U.S. government-issued treasuries. How is this return calculated? How is the return on 10-year bonds transformed into an annual compound return?

Q: Good Morning: I have been raising my cash holdings somewhat in light of a prolonged bull market with high equity valuations and increasing geopolitical risk. I have some of this cash in HISA's with an average yield of about 1.7% or so. However, I am considering putting some of it into a bond etf since I don't feel I have the know how to successfully put together a ladder of actual bonds. What I would like your opinion on is what would be the best 2 or 3 options in Cdn. bond etfs for preservation of capital combined with optimal yield (recognizing that the two are almost always working in opposite directions.) Of course, if you have another option for parking cash, that would also be appreciated. (I do have some preferred share holdings but past experience has taught me that they are not immune to market corrections.) Many thanks.

Q: Please give me your three top fixed income etf's.
Also, I would like your top Europe and International E T F's.
Thank you again for your help!
Audrey

Q: What would be your preference between either CLF or XBB for government bond exposure at this time?

Q: I have the fixed income section of my portfolio (about 20%) invested in 1-4 yr GIC ladders earning virtually nothing after inflation. This money is there to stabilize the portfolio and provide an emergency fund in the event of a very significant need for funds, but hopefully never needed. I also have 50% of my portfolio in large cap dividend paying equities that provide income in excess of current requirements so would only draw on the GIC money if the cash need was quite large.
Is there any other investment you might recommend for the fixed income portion of my portfolio that would provide similar safety and liquidity but improve returns in a rising rate environment? Thanks for the help. Jim.

Q: Could you please outline the risks in holding these types of high yield bond ETFs, with respect to the effect on the capital and yield components. I have a long term (15-20 years) view.

Are there scenarios where more stable bonds (ie. XBB) might outperform it over a longer period (15-20 years) of time?

Thank you

Q: COULD YOU TELL ME YOUR VIEW REGARDING THOSE ETF, FOR AN INCOME PORTFOLIO.(CBO - XBB - BXF )
THANK YOU.
P.

Q: With bond rates as low as they are, does making GICs the fixed income portion of a portfolio make sense for a middle aged beginning investor, or is a bond fund still the way to go?

Thanks

Q: Hello 5i
I have been using Preferred shares as fixed income strategy but would like to ask for your recommendation on traditional bond ETF and a Mutual Fund. (volatility dampening and downside risk protection)
Can you comment on return expectation and whether one should just stay in cash instead of select a bond investment?

Is there another strategy or investment that may be a consideration for inclusion in a well diversified equity portfolio to accommodate volatility dampening like Government bonds are suppose to do(but do not like 0 or negative return)?

Thanks
Dave