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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: Hi 5i
I purchased this etf for my mom. Can you tell me:
1) would 5i expect it to trade below its one year expected yield return from dec 31,2019 to dec 31 2020?
2) Mom’s capital position is currently underwater. What is 5is best guess for the closing price of each share dec 31, 2020?
3. I’m trying to assess the overall risk of the etf. How would this ETF do if a recession broke out in 2020?
4. Can you recommend a better replacement? Why is this better?
Thank you.
Read Answer Asked by Kat on September 12, 2019
Q: Thanks to Lloyd (5ier) and 5i, I purchased this etf for my mom’’s rrif. I purchased it for the 2020 dec 31 maturity date, low(ish) mer, and ok yield. Since purchasing, the etf has changed names twice and may have new owners- Guggenheim-power shares-, invesco. I have noticed that her monthly payments are never the same but not so bothered by that. Will the mer change? Will the maturity date change? What normally happens when paper is shuffled around like this? Is it a bad sign? If I hold to maturity will there be a capital loss?
Read Answer Asked by Kat on June 15, 2018
Q: A follow up on your recent response regarding XHY and BSJK.
What is the difference in risk factors comparing these two funds if interest rates rise as expected over the next 2-3 years.
I would expect BSJK to act like a single bond held to maturity ( 4% annual return with 100% of the principal returned in 2020 ). XHY yields 5.3% but rising rates could substantively reduce its value, resulting in a net loss if redeemed in 2020. Am I understanding this correctly?
Read Answer Asked by Lloyd on April 24, 2017
Q: Whats your take on Defined Maturity Bond ETF's such as BSJK? As I understand it, bonds in the ETF are held to maturity to remove market value risk from rising interest rates. I've aways used ETFs' for bond holdings. However with all the noise on what rising interest rates can do to portfolio values, I'm currently mainly in cash for my fixed income allocation. Instead of buying an ETF, do you think its "practical" for a retail investor to purchase sufficient holdings to be diversified ( and held to maturity ) in order to to accomplish the same "de-risking" without the MER? And lastly how many high quality corporate bond holdings make it diversified?
Read Answer Asked by Lloyd on April 17, 2017
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