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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 am considering adding some lifeco to my portfolio due to what appears to be a rising interest rate environment. Currently banks are at 8%. As Sunlife has recently had a run up I was thinking of FLI as a play on both US and Canadian lifeco's with some covered call protection . Do you recommend this strategy as opposed to individual companies and if not what lifeco would you recommend ? Buy now or wait for US policy in December ? And do I need to deduct FLI's mer of .93% from the indicated yield of 5.35% to find the true return ?
Read Answer Asked by Garth on November 16, 2016
Q: Please comment on the earnings results of both Dream Global and H & R Reit. Do you think the listing of Dream Global on the Frankfort Exchange will be positive. Would you be adding to these at this time? Thank you for you great service.
Read Answer Asked by Stella on November 16, 2016
Q: Is there an ETF listed on the TSX that replicates fairly closely Barclays Global Aggregate Bond Index? If so, what is your opinion of the fund as a core vehicle for the fixed income allocation of my portfolio, in addition to laddered GIC's? Many thanks!
Read Answer Asked by Paul W on November 16, 2016
Q: My question concerns asset allocation. I understand how rising interest rates can affect utilities that have a lot of debt or low oil prices affect energy companies but I am less clear why other sectors should be declining in what is being generally viewed as an improving economy. For example, why are consumer staple stocks declining in an atmosphere where economic growth is expected? Does sector rotation fully explain this?

In the same allocation vein, my one weighting anomaly is in industrials, where I have a 25% weighting. I hold EIF, MMM,ECI, HEI (a US airplane parts manufacturer), STN and SIS in fairly equal proportions. Most models suggest this sector should be at most a 20% weighting but when I look at the list I see companies in different industries and businesses and I wonder what a water heater rental company and an engineering company have in common. Am I being too slavish to an asset allocation model or is there something that ties these companies together that I am overlooking?

Appreciate your insight.

Paul F.
Read Answer Asked by Paul on November 16, 2016
Q: Having just lost a pile of dough on Cipher (moved on as suggested) And having averaged down my cost on BOS a month ago, I am now down 48 per cent on BOS. I can hold for four more years if you think the company has merit. I don't need to sell am sitting on a lot of cash. But I am not mentally prepared for a 75 per cent loss. Do you think it can have a better 2017 or take my loss. Thanks for your sage advice.
Read Answer Asked by Helen on November 16, 2016
Q: I was encouraged by Avigilon's quarterly performance until I compared profits with history and looked at actual earnings per share rather than the adjusted earnings per share shown. Actual was only $0.08. I questioned to myself the adjustments which increased the earnings to $0.21. Also, compared to history, there was nothing outstanding solely in terms of earnings per share. The only positive I see is record revenue but to me a huge revenue is not worth a lot unless it translates into profits. Perhaps I am missing something but I see no reason to continue to hold my shares in this company. I did not follow your advice and did average down with an average purchase price of $21.38 per share. Do you share my thoughts on this company? Thank you
Ed
Read Answer Asked by ED on November 16, 2016
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