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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: I've been in the market for about ten years. During that time a certain predictability has emerged in what sorts of stocks get most heavily hit during market routs such as today's., and what sorts of stocks are least damaged. That predictability has disappeared since February. In fact, when the market drops down heavily the stocks most likely to be hit hardest are the ones which used to be hit least, like utilities, REITs, banks, and other dividend stocks. Do you have an explanation for this? Shouldn't the low interest rates which make bonds unattractive protect these stocks to some extent?
Read Answer Asked by John on May 01, 2020
Q: Given the dividend cut today - does your view regarding the odds of cuts for Canadian Bank stocks as well as other blue chip Canadian dividend payers change. I realize that RDS is in a very tough industry right now but I would say the severity of the cut was pretty surprising and I wonder if there will be similar surprises in Canada for "undoubted" dividend payers in the past.
Read Answer Asked by Gary on May 01, 2020
Q: Hi 5i,

Inflation or deflation. What do you see as more likely over the next 12 months? I would think that inflation is the risk, but central banks opened the presses during 08/09 and we did not see huge inflation spike. I'm beginning to think deflation is the bigger risk as more people will not or can not spend more once the crisis is over.

TIA!
Read Answer Asked by Wayne on May 01, 2020
Q: Hello Peter,
The quarter beginning January is generally good for the market and this year was no exception until the time global economy was paralyzed by covid19. Now we are in May the time for sell and go away. Besides, history would suggest that the recovery does not happen in a straight line. I would like to know what probability you would give for a correction next couple of weeks, before /after the earnings season ends.
The recovery is usually led by large cap which has largely been the case and recently the small caps are showing signs of life as evidenced by the ETF IWO. I am fully invested participating in the recovery and here is the dilemma. Do I stay the course or should I trade the swing if there is a say a 70 percent or more probability of a correction happening soon. And I am not trying to be exact but reasonably close; and could do with your experience and expert opinion on this. And should I raise cash from large caps or the smaller growth stocks, almost all in the tech sector and in the USA. Both will recover eventually but which group would be primed for a trade if that is the route to go.
Thanking you in advance.
Rajiv
Read Answer Asked by Rajiv on May 01, 2020
Q: I put a bunch of new money into my various holdings after some of the big market drops. I did miss the bottom and have just come into quite a bit more cash. Would you be deploying now after the recent gains, or do you have reason to believe there will be another sell of and decline? I have a tough time thinking the crisis is over, and if the stock market is just going to go up from here that really means the entire world overreacted doesn't it?
Read Answer Asked by david on May 01, 2020
Q: Another member pointed out that you have a link to "Dividend Updates", which I did not notice before. I don't recall seeing an email announcing that.

What is the criteria for entries in that list? Is it all Canadian stocks that report dividend changes? Since Jan 1, 2020?

I maintain my own list of dividend changes for stocks that I own, and noticed that there are a few dividend changes missing from your list. These changes were announced after Jan 1, 2020.

Specifically:

PPL Announced 20200106, up 5%
BPY.UN Announced 20200205, up 0.76%
BCE Announced 20200206, up 5%
BAM.A Announced 20200213, up 12.5%
TD Announced 20200227, up 6.76%
ENGH Announced 20200305, up 22.7%
SGY Announced 20200309, down 90%
VET Announced 20200316, down 82.6%
SGY Announced 20200415, dividend suspended
MX Announced 20200429, down 90%
Read Answer Asked by Paul on May 01, 2020
Q: Hi,
I am interested in DIR but not totally sure what qualifies as "industrial" / how affected it is from the economy. Is industrial mostly amazon type delivery stuff? I'm just trying to figure out how much COVID impacts DIR... because amazon/online shipping seems to be fine (other than people spending less due to having less money), but what other uses are industrial?

Would you suggest switching CSH (even at a loss) to DIR at this time?

Thank you as always
Read Answer Asked by Max on May 01, 2020
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