Investment Q&A

Q: I am thinking of shifting my portfolio to overweight Chinese equities such as Baidu, Ctrip, Iqiyi, NIO, JD.com, BABA, Tencent. I have a very high risk tolerance and these are all long term holds 10+ years if needed. Couple of questions, firstly any red flags in any of these names. Secondly, what do you think of Chinese equities in general? My thesis is that the Chinese market sold off aggressively last year and valuations look cheap. Trade wars seems to have been priced in and if we get some type of deal potential upside there. I know the economy is slowing, but I believe this is priced in also as thats all I hear almost on a daily basis from BNN, Bloomberg, CNBC, etc. Also, the possibility of stimulus and rate cuts seem bullish for the equities. Your thoughts? Thank you.

Q: I'm in China for a few weeks, and I am astounded at the payment system. The only place I've been able to use my Visa card is Starbucks. For me, everything else is cash, because I am not set up for the point-of-sale system here. Aside from the few foreigners paying cash, this is truly a cashless society. Each vendor has a scan code sticker - Purchasers use their phone, scan the code, and pay the bill in one easy step. Do you know which companies are behind this system?

Q: Hi Peter, Ryan,
Thanks for the great service Peter and Ryan. It is trying times for portfolios

We picked up AMZN (2%), KXS (1%), ZCH (2%) and GOOGL (1%) in the last few days. Also owned is BABA (3%), NVDA (2%). We have 25% in cash available. Is tech recommended to be 15% or 20% of a portfolio as of today with all the recent drops? I am going against the grain here for a bump up in 2019. Of AMZN, BABA, KXS, GOOGL, FB, MFST, BIDU, & PHO, and an outlier BYD.UN which 2-3 stocks are most appealing for a recovery?

Cheers
Jerry and Debbie

Q: Looks like it is good time to buy Chinese stocks?,
After scary month of October most of us are very low in our total equity at the sometime some stocks have become very good buy but we need your opinion before we buy.

Q: I have some spare cash. Risk taker. In light of the recent pullback, would you suggest some growth securities preferably outside of Canada and USA for TFSA? The latter has to do with issues with US estate taxes for holding individual US stocks in personal accounts. ZQQ would be OK as it is Canadian domiciled but invested in USA situs property. Thanks.

Q: I utilized tax loss selling for BABA in cash portfolio, but I am also down 20% in my TFSA. I am tempted to hold until things improve, but it's hard to read the market. What is your advice, hold or sell?

Q: What would be best buy today. How would you rank them?

Thanks,
Milan

Q: In my cash account, I am down 22% on BABA, up 52% on ALGN and up 54% on TRHC . Would you claim a loss on BABA and buy either ALGN or TRHC? Sectors are not an issue. I do like BABA, but the war between Trump and China seems not to be resolved in the near future.

Q: Dear 5i Research,
I enjoy reading your watchlist questions. I am 67 years old, semi retired and enjoy doing my own investing through a discount brokerage over many years. I do have a high risk tolerance. My retirement income is CPP, OAS and my stock portfolio in 7 figures divided amongst 6 stocks. I am a very “concentrated” investor having gone from 30 plus stocks and ETF’s to only 6 stocks – Constellation Software (CSU), Alphabet (GOOG), Berkshire Hathaway (BRK-B), Amazon (AMZN), Alibaba (BABA), and Tencent (TCEHY). I follow them all closely. Should I be concerned about my high tech component and rather concentrated portfolio? What type of diversification if any would you recommend?

Q: I currently hold these stocks with a good profit in the American companies and a slight loss in the Chinese companies. While I know your focus is Canadian stocks I would appreciate comments on any or all of these holdings and, in particular, should any be sold if I plan to hold for a three to five years.
Please charge my account appropriately for the multiple stocks in my question.
With appreciation!

Q: Interesting article in Globe re Softbank. I am looking for some international growth prospects (especially outside of US). I hold Alibaba (which Softbank invested in recently according to article) and Tencent, the competition to Alibaba.
Would you add Softbank at this juncture given its current price?
Hold or sell Tencent?
Hold or sell Alibaba?
Thank you.

Q: Good morning,

I have questions regarding the taxation of foreign dividends. I know that for US dividends, the 15 % tax does not apply for stocks held in a RRSP, but does so in a TSFA or regular account.

- What about non US stocks listed in the US? Are they simply treated as a US stock since they are listed in the US or do other rules apply depending on where the company is based? Good examples would be stocks like LYG (UK) or BABA (China).

- More generally, is the deduction applied automatically when the dividend is paid or does it have to be declared manually by the shareholder on its annual tax report?

I understand fiscal matters are not your specialization, but I figure you or other members might have had the same questions at some point.

Thank you!

Q: Which of the above two securities would yo recommend for a 5 year hold and your reasons. Thank You.

Q: Could I have your opinion on this company would this pullback 10% be a good time for a half position do you think they have a long runway of growth and are they considerably cheaper than Amazon on a EPS basis thanks for professional service Greg

Q: It's getting a little scary to see such huge profits in my portfolio (Cash, TFSA, RRIF). I know you are flexible about percentages, so I'd like your opinion on whether to reduce the following equities and by how much?

SIS 7% ; BABA 6% ; NVDA 9%; SHOP 8% ; ALGN 6% ; DOL 9% ; PBH 9%.
Many thanks for all your thoughtful advice.

Q: I hold BABA.us in a registered account. I bought believing Chinese sponsored ADRs are subject to SEC disclosure requirements. Your response to my question on MOMO.us confirmed the above. But I am not so sure now that you or I are correct in our beliefs. I was not necessarily surprised to hear Jim Chanos say he was shorting BABA.us. That’s not odd per se. I was however startled to hear him go on to say his SOLE reason for shorting BABA was that he didn’t trust its accounting and filings. He went further and said BABA-- and I now presume other Chinese ADRs--- do not follow US or international acctng rules (IFRS, FASB etc. and not SEC regs). Yet BABA is by law required to file disclosure with the SEC. Please comment on the issue of the RELIABILITY of financials AND those all-important DISCLOSURES, that BABA and its auditors need to file with SEC. Should I believe those filings as much as you do? Chanos’ argument and puzzlement were over the fact that net value of BABA was lower today than when it did its IPO. Chanos wonders where the profits and cash are flows the company has generated and reported since IPO ! Chanos or his shop is do not slouch when it comes to doing homework on filings. What gives? Should I believe those filings (as stated in your response to my question on MOMO?) I have a lot in Chinese Tech ADRs and this issue now has me re-thinking the basis for my buy decisions.

Q: Just wandering about your thoughts on TEVA for a 1 year hold do you think they have “turned the corner”also same thing question about ALIBABBA for a 1-2 year hold seems to have good momentum lately charge me for 2 questions and thanks for the professional service

Q: I am looking for the next Amazon or Constellation to put way for next 5 years.Can I have your thoughts on this. I was thinking of the two I mentioned along with SHOP, MSFT, BABA, 10 CENT, TESLA. What other names ? What do you think ? RAK

Q: Hello! I'm a recent subscriber to 5i and liking what I see so far! I have a favorable view on the tech sector and own CQQQ and BABA. Any thoughts on these names or sector in general? Any other names that might be a good fit (besides Amazon)? I was also thinking VB would be a good way to play the tech and financial sector at the same time. How long has it being in the growth portfolio? Any other suggestions regarding niche banks?

Q: In what order would you rank these stocks which has the better growth profile? . Your opinion will be appreciated Thank You Claude