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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: How would you rank these bond funds. I sold FTB and bought PMIF but it is not performing well. Bond funds have not performed well due to the drop in interest rates. I am retired in my late 70’s.
Read Answer Asked by Donald on March 24, 2020
Q: Looking for a 2nd opinion.
My wife has stayed out of the stock market for quite some time. I think now's a great time to get in.
We've got about $75K in her RRSP/LIRA My strategy for her is as follows:
XBB 20%
VCN 15%
XUS 40%
XAW 25%
The plan is to buy in in installments over the next 3 months.
Are there alternate ETFs that may be better than the allocation above?
Does this strike you as reasonable ?
Read Answer Asked by Michael on March 24, 2020
Q: Would you have any recommendations for individual corporate bonds with decent yield to maturity for up to a 7-year term? Based on my research, yield remains low for decent quality. Thank you!
Read Answer Asked by Pierre on March 18, 2020
Q: Interest rates are dropping but bond funds are getting clobbered - they normally would go up - is there fear that huge numbers of companies are going bankrupt such that bonds will not be repaid? It doesn't seem to matter whether short term or long term bonds - they are going down. XBB down 3%, ZAG down 3%, ZCS down 4% today so far. This seems crazy. Is this a buy opportunity for corporate bond funds or is the great depression about to happen and everything should be sold into cash?
Read Answer Asked by David on March 13, 2020
Q: 5i
Being retired with~40 % in bond ETF`s as my fixed income and thus part of my relatively safe part of the portfolio , i was quite surprised when equities dropped so much today , that the bond ETF`s dropped considerably as well ie CBO , ZAG and XBB . They all dropped ~4% .
Can you help me to understand why bonds would drop so much under this scenario ? If investors are fleeing to safe havens such as treasuries and bonds and out of equities why do bond prices drop particularly as much as it did today ?
Thanks
Bill C.
Read Answer Asked by Bill on March 13, 2020
Q: Hi,

I don't know much about bonds, but am considering the fact that perhaps I should have some in my portfolio. It's hard enough for me to keep with with the few stocks I own and watch and I'm hoping you can provide a few simple 'set it and forget it' type ETFs that provide good bond exposure.

Cam.
Read Answer Asked by Cameron on March 11, 2020
Q: I am a long time subscriber and an avid reader of the Q&A. Even with all I have learned, I am still having a difficult time understanding how to invest the fixed income portion of my portfolio. I want fixed income to provide portfolio stability by protecting on the downside while offering the possibility of capital gains along with some income.

I am a buy and hold investor on the equity side and I am comfortable deciding when to sell a company. However, the fixed income side seems to demand a more active approach - or does it? For example, you have been suggesting that interest rates seem likely to decline in the coming months so that would favour long term bonds. But for stability, or as an offset in case I am wrong, should I also hold short term notes? Should my fixed income portion be split 1/3, 1/3, 1/3 among cash, short term and long term and just left at that or is it necessary to continually monitor and adjust these weightings? Or is there one fund that does all that already?

Appreciate your insight.

Paul F.
Read Answer Asked by Paul on March 02, 2020
Q: Hi,
There are slim pickings for the retail corporate bond investor at the moment. I found a five year Ford Motor Credit bond with a BBB rating paying an effective yield of 3.55%.

Do you think the risk/return on this bond is reasonable? I am hesitant to buy it because of the history of the auto industry during recessions and the current state of personal debt in Canada.

Thank you. Michael
Read Answer Asked by Michael on January 27, 2020
Q: I'm looking for a safe place for cash with a decent yield. This could be for several months or several years. How would you compare ZSH to PSA? Is one better than the other? With uncertainty over interest rates, do you have any recommendations for the fixed income portion of an investment portfolio?
Read Answer Asked by Jack on January 21, 2020
Q: Looking to increase my fixed income exposure. Currently hold CBO, XBB, and CPD (preferreds). Thinking of adding XHY in addition to these, would you recommend additional ETF's in this space to help diversify?
Read Answer Asked by Patrick on December 05, 2019
Q: I start withdrawing from my RIF next year. At this point I have just under 6% in VSC, 5% in XBB, 2% in XHY and was thinking of adding some CBH for the longer term corporate bonds.

If you feel my thinking is correct what % limit would you set for CBH? I know there is more to my investments than what is listed here with BCE and ENB et al also held for their income stream but I want to get your thoughts.

Thank you,
Ron
Read Answer Asked by Ronald on December 02, 2019
Q: Hi,

In your answer to James you suggested the following bond ETFS: XBB, XLB, XSB, CBO and/or XHY. I'm very interested in this as I'm trying to increase fixed income exposure.

What percentage would you suggest in each of the total bond portfolio? Also, unless I am missing something, CBO and XSB both appear to be the same thing, so why the need to own both?
Read Answer Asked by Pamela on November 27, 2019
Q: Hi
I am looking to add a bond etf to my portfolio. I am looking for something with a reasonable yield, that is defensive with some possible growth opportunities. Could you recommend the one that fits that those criterion or if you have a better choice, I would appreciate it. Thanks
Read Answer Asked by Leonard on November 07, 2019
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