Q: About 5% of my portfolio is comprised of SLF and MFC, of which SLF is about 2/3s today. Another 10% of my portfolio is Cdn Banks.
After today's movement, what would you think of selling MFC and consolidating into SLF?
Also, given the inflation sirens, what would be a reasonable amount of bank holdings and insurance co holdings?
Thank You
5i Research Answer:
Insurance companies tend to do well with higher rates, so we would not be too concerned with the sector. Banks CAN do well, providing the economy is strong. For insurance companies, we would be fine with SLF only over both SLF/MFC. We think 15% might be a sector guidance. The TSX is 33% currently and we think that is too high.