skip to content
  1. Home
  2. >
  3. Investment Q&A
You can view 3 more answers this month. Sign up for a free trial for unlimited access.

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 opened an in trust investment account for my two children aged 9 and 10. At this time I have $5000 for each. This money is not intended for their education as I a saving for this separately. I would like for this money to sit for them long term and grow. I would like to buy one or two stocks for long term growth and a decent dividend is a bonus. Can you suggest one or two stocks that fit this category. I do plan to add small amounts over time for them.
Read Answer Asked by Sarah on September 30, 2016
Q: My friends who invest in the housing I.e rental apartments/townhouses seem to be making outsize returns...I personally feel this is because their purchases are highly leveraged. They require only a 20 to 25% down payment to buy a rental property. I personally think it is much safer and easier using a diversified groups of stocks.. especially with the great advise from 5i.but to make outsized returns one needs to borrow money..Banks give preferential rates for home purchases.whereas equity purchases are treated as riskier investments.What are your thoughts on this? I would also like it if your members weigh in on this subject.
Read Answer Asked by Shyam on September 29, 2016
Q: When calculating sector distribution I include all equities, both foreign and domestic. Have I missed the point, since sector correlation will be different overseas relative to US/Canada, except for cases such as commodities that are global in nature. With that in mind, how should I break down the analysis? 1. Domestic, US and international each separately, 2. combine US/domestic and treat international separately, 3. don't bother tracking international sector allocation (mostly market ETFs). I tend to use US companies to fill sector gaps where Canada is weak (e.g. health care).I also wonder how to treat the US megacap multinationals.
Read Answer Asked by Benjamin on September 28, 2016
Q: I have the (dubious ?) honour of being age 71, and as such I must convert my RRSP into a RRIF by this year-end. I am also aware of a rule that allows me to use my spouse's age (younger) to determine the minimum percentage that must be withdrawn each year. I further understand that the CRA rules do not allow any change once this choice is made.
The minute CRA says there cannot be any changes, a red flag goes up, and I wonder if I am missing something. Do you (or other subscribers) know of any reason why I should re-consider choosing the lower withdrawal rate. Thanks for your great service. T.
Read Answer Asked by Terrance on September 27, 2016
Q: Hello Peter and team:

You may want to perhaps address this question through your Blog or answer it here. Whatever you think is appropriate is fine with me.

What do think of the article in the Globe, Report on Business section, Saturday September 24 2016 edition by David Milstead on Big companies using non GAAP methods to report their earnings, profit, write downs and such. Except Imperial Oil, all the companies fail GAAP standards his article claims.
Many of the companies that you recommend don't fare well in the analysis by Veritas. For example Agnico, Manu Life, Magna, Interpipline etc., In fact 4 out of 5 companies negatively highlighted by the Globe are your favourites! Interestingly all the banks fare reasonably well which surprised me! The same bankers who "forced" the Govt to enact "opt in" measure come out as "reasonable"?
I went through the table provided by Veritas very carefully. I find that the following companies seem to have the least variance between GAAP and non GAAP measures: AGU ATD, BCE, BMO, BNS, CM, CNR,CTC, DOL, EMA, GIL, IMO, MRU, NA, POT,POW, PPL,RCI, RY, SAP,SJR,SNC,T, TD, WN.
Am I right in interpreting that these companies are "reasonably" clean in their corporate governance? Does this list by Veritas correlate with other lists by other companies that measure or evaluate ethics of a company by entirely another set of variables?

Do you folks consider this accounting issues when you choose a stock?
Thank you for your patience in advance. My apologies for this rather verbose question.
Read Answer Asked by Savalai on September 26, 2016
Q: Good Morning: I saw an article in the Globe a few days ago about a firm called "Transcend" which is a program run by Provisus Wealth Management. Looks like the principal player is Chris Ambridge. They are advertising themselves as a "pay for performance" discretionary money manager where you pay a minimal account maintenance fee (25 basis points annually) and then a performance premium of 20% on account profits (or smaller losses). However, the 20% is apparently only on profits that are better than the performance of the appropriate market. So for Cdn. equities I assume that would be the TSX. Wondering if you know anything about this program, know any of the principals at the company, or have an opinion about the merits/demerits of this kind of account. At the moment, I am a self-directed investor using BMO Investorline. As always, thanks.
Read Answer Asked by Donald on September 26, 2016
Q: Given that most, if not all of your highly rated IT co's are software business solutions co's and diversified across many sectors, is there any need to apply a 'sector' limit to them. I know they may all move with the IT sector during rotations, but not on fundamental issues that affect all co's in some sectors e.g. resources. Applying a sector limit seems to be excluding many fine growth co's from a portfolio, at the expense of including less attractive co's in the quest to diversify sectors, but is this necessary? Why have a sector limit at all when the co's in question are themselves diversified?
Thanks, Peter.
Read Answer Asked by Peter on September 23, 2016
Q: With gold producers tightly a liked to the process of gold, there seems to be a 1 to 5 ratio of impact (gold increases 1%, producers increase 5 or more %). Over the past few days we see spot increase or decrease without a symmetrical impact to producers. Can you comment on what else impacts the general sector or are the more sensitive to factors and in fact spot prices are trailing?

Thanks,

Eric
Read Answer Asked by Erichsen on September 23, 2016
Q: OK the Trump effect ... would it be prudent to turn all investments into cash lets say a week ahead of the US election (50 stocks X $10/transaction =$500) and if Trump wins ride out the wave of volatility and then buy back into the portfolios for another $500 hit possibly avoiding the chaos that would follow the Donald into his presidency? If Hillary wins would you expect a positive response from the markets?
Read Answer Asked by Alan on September 23, 2016
Q: I have been a bit worried about the US market, as measured by cyclic PE it seems quite expensive. I have used the recent strength to sell some of my low conviction stocks and take half positions in what I consider to be better companies. My cash is now up to 10%.

My first question is do you think this cash level is appropriate for the market now? My second question is, given a pullback how would you deploy the cash. Immediately on the day of a big drop, say over 200 points on the Dow?. Or try to time the bottom using technical analysis? Or gradually ease into a position starting the day after a big drop in the market? Any other suggestions gratefully received.
Read Answer Asked by Andrew on September 23, 2016
Looking for more? Sign up for a FREE 14 day trial! No credit card required

We invite you to sign up for a 14 day free trial of 5i Research!
Experience all the benefits and tools we have to offer; stock research, model portfolios, Q&A with our experts, and so much more. Join a community of like-minded investors today!