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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'm looking to start a new half weight position in an RSP account with a 10 year time line. Sector allocation aside, how would you rank these in terms of capital appreciation from most favorable to least. I have good tolerance to risk.

Thanks in advance,
Greg.
Read Answer Asked by Greg on June 25, 2018
Q: More of a portfolio construction question, I would really appreciate your opinion on the following. Whether in The Post or The Globe, more and more, I’m reading in the ‘personal financial profiles’ that individual investors should be allocating, in some cases up to 30% of their portfolios, to alternative investments. These typically include private company debt, individual mortgages, and ever-increasingly now, factoring, the assuming of small business’ accounts receivables.

I’m a conservative investor, close to retirement, no pension, planning to live off the income of my portfolio. Without over-reaching for yield, I invest in mostly blue chip big-cap, reasonably diversified, with an allocation to some of your growthier names. But when I look at what is increasingly being suggested by planners, always under the auspices that alternatives are safer because they cannot be marked to the market in times of corrections, I cannot comprehend it. Companies that cannot qualify for the better rates that banks offer, people who don’t qualify for bank mortgages, and companies who have to sell their receivables because they cannot wait to collect them on their own, sound very high risk to me, worlds higher than investing in a mix of banks, lifecos, utilities, pipelines, industrials, tech, health, reits, preferreds, fixed income, and the like. While the market values of what I typically invest in can tank during correction periods, in my mind, they certainly don’t carry the very high risk of permanent capital loss that these so-called alternatives do. Particularly so since most of the ‘alternatives’ I assume are small companies.

Are these being offered because, a) you require a broker to get them for you, hence you must use one and pay fees, and your accounts likely become stickier because of it, and b) so a broker, when in a correction period, can point to these and say they’re safer because they’re not reacting to the negativity — but only because in truth, there is no market to mark them against. Not until you try to sell, that is.

Long question, but am I missing the bigger picture, and these ‘alternatives’ are something that should be considered?
Read Answer Asked by Warren on June 25, 2018
Q: Mr. Hodson, today GUD and CSU concluded the day respectively at $8.02 and $1049.95. Do you consider these prices appropriate for the time being ? Is there any action you would recommend regarding either of these stocks, or is everything fine ?
As GUD reached $10 in the past, do you foresee the stock reaching that value again ?
Recently, you recommended awaiting a few weeks before buying more GUD shares; are you still of the same view in this regard ?
Read Answer Asked by Serge on June 25, 2018
Q: I was hoping that you or one of your subscribers might be able to assist me. My understanding is that the IRS requires all US citizens to file US tax returns even if they do not reside in the US or have ever worked in the US and recent laws make the failure to do so extremely punitive. My question is - I was born in the US to Canadian parents who were in the US 60 years ago for a brief work term. When I was born they applied for and received a "certificate of Registration of Birth Abroad" from The Canadian Department of Citizenship and Immigration to certify that I am a Canadian citizen. Am I still required to file yearly IRS tax returns even though I have never worked in the US and am legally a Canadian citizen?

Many Thanks

Read Answer Asked by Scott on June 25, 2018
Q: Since it's recent run WSP has become about 3.2% of my portfolio I am thinking of moving some funds to PBH which is 2%. Looking at your company data the earnings growth projected for PBH is 35% whereas WSP is 6.6%. Based on the analyst median prices for each the return from todays price would be WSP -4.93%
and PBH 16.9%. It would appear that PBH has better potential over the coming year however WSP's price performance has been much stronger over the short term (certainly not over a 3yr period).

Would you make the switch? If so which factor would carry more weight: balancing the portfolio, projected return, or price momentum?

Many thanks.

Mike
Read Answer Asked by michael on June 25, 2018
Q: can you tell me your top suggestions currently in Canada and the US within the consumer discretionary space?
Read Answer Asked by Patricia on June 25, 2018
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