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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 Peter- This question is about Fairfax Financial Rate Reset Preferred Shares. FFH.C can be called in Dec./2014. Between now and then you will get 8 dividend payments totalling $2.88. It currently trades at $25.87. There will be a loss of 87 cents meaning that your profit is $2.01 share or 3.9% over 2 years.
FFH.G gets called in Sept/2015. There will be 11 payments totalling 3.44. It is trading at $24.70, so add a 30 cent gain for a profit of $3.74 a share or 5.5% per year over 2.75 years.
The one that seems to be too good to be true is the FFH.PR.E which expires in between these two in March 2015. It trades currently at only $23.11. A gain of $1.89. With 9 payments totalling $2.67, you have a total gain of $4.56 on an investment of $23.11 or an amazing 8.8% average annual return over 2.25 years. What am I missing? You have 3 pref issues with a relatively close annual dividend and relatively close call date but with extremely different market values. Same company. All Rate Reset. Is FFH.E a buy?
Read Answer Asked by RANDY on January 09, 2013
Q: Hi, Peter. Could you let me have your thoughts on Purepoint Uranium (PTU), please. From about two weeks ago, it went from 6 cents to 9 cents on Mon 7 Jan, after being almost dead for over a year. They recently (a few months ago)struck some kind of deal with Cameco, who hasn't been doing that well either. Thanks, Dale
Read Answer Asked by Joan on January 09, 2013
Q: Neptune Tech and Bioresources (NTB). On the one hand expert opinion and copycat attempts indicate there seems to be value in the Krill oil patents, but I am concerned about the quality of management (apparently so are some other investors who filed a lawsuit today). After holding the stock for years they seem to nearer to producing earnings. I understand they have an excuse in that the plant blew up but again that poses questions as to quality of management. Are the management unlucky or simply incompetent? Is it worth hanging on or better to cut losses?
Read Answer Asked by Andrew on January 09, 2013
Q: Would you have any tips for Convertible Debenture issues for my RRSP on a long term hold? I currently own FCR.DB.E and MRT.DB.A from issue and am looking to add a third or fourth in the aftermarket...Jeff
Read Answer Asked by Jeff on January 09, 2013
Q: I would like your opinion on the large amount of insiders selling PBG (Petrobank) in December, after the announcement but before the reorganization of Petrobank where they distributed the shares of Petrobakken to Petrobank share holders.
Then on Jan 3rd after the reorganization many of the insiders were buying PBG, PBG is almost trading at it's cash on hand.
Also can you recommend a book on insider trading, Iv'e been following insider trading for the last year and seem to be doing fairly well.
Thanks
Read Answer Asked by Doug on January 09, 2013
Q: Hello. Could you give me your opinion on MSV(minco silver). They released an update and advised of some potential interest coming out of China. They seem to have a good balance sheet also. thanks
Read Answer Asked by George on January 08, 2013
Q: Peter please give me some insight on dennison mines or northern minerals thx
Read Answer Asked by frank on January 08, 2013
Q: Although I don't mind shopping at Sears (SCC), I wouldn't want to invest in it. How's their valuations? Is it just competitors beating them now and eventually Target?
Read Answer Asked by Michael on January 08, 2013
Q: Hello, Peter.
I hold a very small position in Canadian Lithium (CLQ.TO)and I am considering adding to it. It appears that the commissioning of the plant in Quebec is well underway and, hopefully, the first shipment will happen by the end of Q1. I would appreciate your view of the company.
Thank you,
Ed
Read Answer Asked by Ed on January 08, 2013
Q: Could you please give me your view of the Canadian Bond market. We have a fund that follow the Dex Universe Bond Index. Recently , we have heard that a lot of managers think that bonds are at risk for a downturn and that they are drastically reducing their exposure to this sector.
Thanks
Read Answer Asked by john on January 08, 2013
Q: I would appreciate any input you can provide regarding fixed income holdings the current environment. I currently hold short term corporate bonds via RQA and RQB. However, the yield to maturity on these products seems quite low to me (1.45% & 1.82% respectively). My time horizon is 15 to 20 years at least.
Read Answer Asked by Stephen on January 08, 2013
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