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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 5i,

Looking for your top 2 or 3 fixed income recommendations for the market we're in, and where you feel we may be headed in the next 12-24 months. Looking for some bond ETFs, preferably Canadian listed.

Criteria is primarily capital preservation with some return to blunt the impact of inflation, and of course liquidity. I want to hold dry powder for buying opportunities I believe will come with recession, but I hate the idea of sitting in cash.

Thanks!
Read Answer Asked by Ryan on July 27, 2022
Q: I often hear money managers talk about buying a specific stock (e.g. Apple to choose a simple one) and then writing covered calls against it ….. and emphasizing the prospect of winning both ways.

I am not keen on taking a course in options trading at this point.

Does it make sense to attempt the same kind of thing using etfs?

For example, in technology using XIT or TEC and pairing it with ZWT;

or other sectors too, such as energy XLE … or XLF for financials? In this case can you suggest a couple of covered calls - one for energy and one for financials?


As usual, thanks…. much appreciated.
Read Answer Asked by Donald on July 26, 2022
Q: Looking to put more reserves into bonds & more secure investments. Looking at your "Balanced Portfolio" I do not see your favourites in this area?
I am underwater with XEB which has little exposure to Russia and Ukraine (downloaded their portfolio), do you have alternatives with a good return and expected to perform well during an economic downturn?
Is there anything fundamentally wrong with XEB as an investment financially?
Read Answer Asked by Ted on July 26, 2022
Q: Rather than buy TIP directly, I am leaning towards buying XSTP and/or XSTH. Given that they are only 15% correlated (no doubt due to the CAD-hedged aspect of XSTH) I am leaning towards buying both. What is your perspective on this scenario for an income portfolio given the current state of U.S./CAD dollar exchange rates?
Read Answer Asked by David on July 26, 2022
Q: Is PDBC a good hedge against inflation and would you recommend it ? What is the dividend with PCBC ? The information on my TD acct. and your website are very different. Are there eff's that provide the same commodity exposure that pay monthly or quarterly dividends that you would endorse. Thanks for your help.
Read Answer Asked by Ian on July 25, 2022
Q: Could you recommend some clean energy etfs that you think is a good way to play the sector? Thanks
Read Answer Asked by Gary on July 25, 2022
Q: Can you comment on the investment merits of these two etfs.Are there others that you would see as more attractive for a diverse long term hold of both Canadian specific and US specific etfs?
Read Answer Asked by Kim on July 25, 2022
Q: Dear 5i,
If one were to hold either VFV or VSP (CAD hedged) for approx. 25 years would you expect the Total Return to be the same for either ETF?
If VFV has long term better performance would it be because there are no CAD hedging expenses?
Read Answer Asked by Ian on July 25, 2022
Q: Regarding US Equity Power Buffer ETF (PJUN): what is your take on this etf to hedge some of the potential downward movement of the S&P 500?. Or would you just hold more cash to try to hedge and protect the downside? How does this etf work and is it worth the MER?
Read Answer Asked by Steven on July 25, 2022
Q: I have heard leveraged ETF’s are not good long term holds. I am looking at QQQ but would TQQQ be fine for a long term investment (15-20yr)
Read Answer Asked by mike on July 20, 2022
Q: For materials sector is FXZ etf a good choice? Is the timing for purchase good right now? Any other suggestions and the outlook for future of this sector.
Read Answer Asked by Mirjana on July 20, 2022
Q: Greetings,

With the Euro/ USD hitting parity are there any stocks or ETF's that directly reflect the weakness in Euro's and allow us to invest in Europe at what is hopefully a discount?

We own ZWE and VGK - Do they reflect the weakness and could we buy more?

Many thanks
Read Answer Asked by Arzoo on July 19, 2022
Q: Emerging market indices have been underperforming for some time now and are ostensibly quite undervalued relative to peers in aggregate. I happen to hold a fairly sizeable portion of my portfolio (~15%) in XEC. As such, I am curious as to your opinion on whether or not holding emerging market exposure is a valuable form of diversification in today's landscape. Finally, acknowledging you lack a crystal ball, do you anticipate emerging markets reverting to the mean in the foreseeable future?
Read Answer Asked by Andrew on July 18, 2022
Q: I am a retired income investor who derives all his income from investments. For obvious reasons I am a fan of covered calls and own the various ZWs and HDIV. I also own the canadian banks and ENB. Most of these have held up fairly well in the turmoil. My question is do the covered call ETF administrators try to keep the return % approx level as the ETF value changes. I note that the RBC quoted return for HDIV is noeth of 10% but ZWC is approx 7% which is not much change from where it was in April. Other ZWs are similar. It would seem that BMO manage the return whereas Harvest do not.
Read Answer Asked by Don on July 18, 2022
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