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Q: Retired, dividend-income investor. I currently own ZLB (RRSP, max'd out), XIT (RRSP-TFSA, max'd out), ZRE (Cash, 3/4 position, will add to over time), ZWC (Cash, close to max'd out). I also have some legacy positions in RBF1018 (RBC Cdn Equity Income-D...MER of 1.0) and CIG50217 (Sentry Cdn Income...high MER), both of which I have averaged roughly 7-8% return over the last many years, prior to this crisis. On top of the above I own AD, AQN, AW, BCE, CSH, CM, FTS, NTR, NWC, RY, TRP, WSP in various amounts to achieve my overall asset allocation targets (not to mention my fixed income portion of my portfolio.

I normally like to run a concentrated portfolio of around 20 positions, composed of +/- 6 ETF-MF and +/- 14 stocks. I have mapped out the use of my current cash (15%) into monthly repurchases over the next 6 months. My question relates to the combination of ETFs, but focusing on ZWC. I own ZWC for its high CC dividend, but recognize that the upside is potentially limited in a recovery. Also, when mapping out spending my cash, I reach an uncomfortable level of too high an allocation per individual stock. That led me to consider adding another ETF. I looked at several, and filtered them down to CDZ, XEI and XDV. I have chosen CDZ as my candidate to add. Looking under the hood at the ETF holdings, they appear to not overlap too much with my own individual stocks.

Do you like this strategy? Does it result in a significant overlap in stocks, held either individually or within the existing ETFs?

Thanks for your help...Steve

Read Answer Asked by Stephen on March 26, 2020

Q: Hi folks, I would like you to reco some good dividend ETFs in the Candian space that you think are potentially a good buy for now. By 'good', I meant the company should have solid fundamentals, and the price should be low so the yield is high. I do not expect the US tech to boom forever, I would rather reap my 7 to 8% percent and hope it last forever. Thanks :) Tony

Read Answer Asked by Tao on March 26, 2020

Q: Retired dividend-income investor. I currently own ZLB (in RRSP, max'd out, love it) ZRE (Cash account, purchase for LT hold-distributions, plan to add to it over time) and ZWC (Cash account, purchased for LT hold-dividends).

I have a sizeable capital loss in ZWC....2 choices. #1 = Keep it, top it up over the next several months. #2 = Sell it, save the capital losses for future years (don't need them for 2020) and replace with either CDZ or XDV. I flushed XDV right away due to the very skewed asset allocation (to financials & utilities).

So that left the comparison between ZWC and CDZ. Their metrics are, for the most part, similar (beta, P/E, P/CF, ROE, MER).

ZWC is down 39% YTD, pays a current yield of 11%, has a reasonable asset allocation (the 22% energy allocation initially may seem high but might be good for the eventual rebound). However, I don't have the knowledge on how the Covered Call part of ZWC may impact the comparison with CDZ.

CDZ is down 43% YTD, pays a current yield of 6%, but has a slightly more diverse asset allocation and has performed better than ZWC over a 3 year period, but has a higher Beta.

I entered the comparison exercise believing I would conclude to sell ZWC. Now however I might just periodically top it up. Your thoughts please?


Read Answer Asked by Stephen on March 24, 2020
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