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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 folks.

With all this talk about higher inflation (new shiny object for the media) there has been very little discussion on the explosion of debt Countries have embarked on, pre, and since the onset of Covid. Seems like this appears to be a coordinated effort throughout the developed world, and as a result, no one seems too bothered, Including Conservatives.
Are there any lessons in history we can draw from? How does 5i think this all gets resolved over the next decade or two, assuming it will take a bit of time to generate enough growth to cover all this?
Are we headed for multiple Japans where the Gov't owns all or most Gov't issued bonds to control interest payments. Does this scenario create even more inflation with depreciation of currencies and a race to the bottom on exchange rates? Way above my pay grade so please take a stab at opining on this for us.

Many thanks.

Read Answer Asked by Arthur on June 02, 2021
Q: Good morning,

I just wanted to pass on information to anyone that uses BMO Investorline as a platform. Starting today they have 80 ETF's where there will be zero commission on buying and selling. Here is the list of the 80 ETF's I think this is a great way to slowly add small positions commission free especially for the kids RESP.

Actually I do have a few questions now come to think of it. Do you think this is a good idea and if you were to pick 3-5 ETFS from this list and somewhat try to be diversified which ones would it be? If you can give me 3 to 5 from the list feel free to take credits per ETF you find.

Thanks

List:
EQUITIES: CDZ / CIE / CUD / CWO / VCN / VDY / VEE / VFV / VGG / VGG / VGH / VI / VIDY / VIU / VSP / XDV / XEC / XEF / XFI / XHD / XIN / XIU / XMM / XMU / XSEM / XSP / XUS / ZCN / ZDH / ZDI / ZDM / ZDV / ZDY / ZEA / ZEM / ZLB / ZLE / ZLI / ZLU / ZSP / ZUE / ZUQ / ZVC
FIXED INCOME: CLF / VAB / VCB / VGV / XBB / XCB / XHY / ZAG / ZCB / ZGB / ZHY / ZJK
MULTI-ASSET CLASS: VBAL / VCIP / VCNS / VEQT / VGRO / XBAL / XCNS / XEQT / XGRO / XINC / ZBAL / ZCON / ZESG / ZGRO
THEMATIC: ZAUT / ZFIN / ZGEN / ZINN / ZINT
ESG: ESGA / ESGB / ESGE / ESGG / ESGY / XESG / XSAB / XSEA / XSTB / XSUS
Read Answer Asked by Jimmy on June 01, 2021
Q: This is an excellent response to Charles’ question asked on May 27 about what to do when stocks are down 50%:

Diversification and position sizing are two items that can help mitigate this 'pain' so the drawdowns do not hurt as much. Otherwise, the best answer we think is just understanding what one owns both on the stock (what type volaitlity might we expect) and on the company (does the short-term volatility 'matter' vs long-term). The optimal answer can only be known in hindsight unfortunately. While we typically don't like averaging down in names, [once drawdowns like this pass and settle down, it can be an opportunity to add to a position once/if momentum starts to work in a company's favour again]. We not generally like stops either. Good companies, over 15 years, might have 7 or more very large drawdowns that might get stopped out (my emphasis added).

My question: how do we know when momentum is starting to work in favour again? A few days of share price increase with more volume? What I generally do is ask has anything fundamental to co changed. If not, and based on the fact that I was prepared to buy at a higher price, I simply buy more understanding risks and do not try to time the market, which can drive one crazy. I do though want to understand more about what generally signals a turn for the better.
Read Answer Asked by James on May 28, 2021
Q: I have been recently trying to learn about stock options especially calls and not puts for starters. And I've been looking at theoretical call options values to see if expected growth of the underlying stock is an input. It seems that the input is "volatility" which surprises me because volatility is both up and down. I get that volatility has a link to growth but why wouldn't a call option theoretical value focus on just the upside volatility which seems much more linked to growth. After all, a theoretical stock value includes an assumption about growth not volatility, so why not so for a call option value? Thanks.
Read Answer Asked by William on May 27, 2021
Q: Hi Guys
Just an observation, People should remember their investing in a company's future prospects and pay less attention to the share price.
If you look at a long term graph of successful companies like Amazon & Apple you will see my point.
If your constantly worried about the share price, it seems to me these people are investing way way more money than they can afford to lose.
Read Answer Asked by Gordon on May 26, 2021
Q: Hi 5i Team, I'm looking for a couple of suggestions on (very) good, general mutual funds in the mold -- if I can reveal my age -- of Bob Krembil's Trimark Fund in the '90s. Nothing country or sector specific, just a couple of funds that have exceptional management and consistently good returns. My wife has a small amount in a LIRA that warrants one or two mutual funds at the most (I like active management; I'm not a fan of ETF's for the most part). Thank you for your insights, Pete in Calgary.
Read Answer Asked by Peter on May 25, 2021
Q: I am interested in finding out more about structured notes. On the surface, it appears a good instrument for regular income. However, do not understand several aspects of it and also there seem to be several types of structured note, e.g. principal protected, exchange traded notes. Not sure what types are suitable for my goals. Can you please provide your views and brief description, or link for more information, or contact who could provide more information. Thanks
Read Answer Asked by Naren on May 12, 2021
Q: Me, scratching my noggin to explain this......Today, the market is down but in my portfolio, the US stocks broke even but the Lonnie ones are way down. Maybe it's to do with the mix of the stocks in the portfolio, eh?!.....or the timing, which Canada just catching up the down ongoing down drift in the US market?
The Canadian ones relate well to the 5iR portfolios and my total portfolio is 45% balanced, 22% income, 11% growth, all Canadian, and the remaining 22% is composed of US stocks. Coming back to today, I wondering if you agree that the Canadian stocks seem to be hit harder or fell more than the US ones? Any specific reasons for that? Thanks for attempting to put a finger on it, or two.....Tom
Read Answer Asked by Tom on May 12, 2021