Investment Q&A

Q: I, perhaps foolishly, assumed that Vanguard Canada ETFs sold on the TSX in Canadian dollars would be Canadian income.... Are all the Vanguard Canada products US income, including VDY? Therefore is it ineffective to hold them in a TFSA?

Q: With the reduction in MER's yesterday in 9 of Blackrock's ishares ETF's, (XIC,XEI,XSP,XUS,XEF,XEC,CAB,XSH,XLB)can you comment on how you would rate these in their categories compared to other company ETFs (i.e.- with the fee reductions, would you now recommend these over competing ETF's?).

Q: Hello Peter, thank you kindly for your great advice to date. I would like your input on my TFSA portfolio. I am holding 6 issues, roughly 16 to 17% weight for each as follows:
ZHY, ZDV, OXF.A, LXF, IPL, and XRE. My goal was to create income but with a preference for long term growth. Am I on the right track? Please suggest any alternatives. Thanks very much!

Q: Why is my CBO 5 year laddered corporate bond ETF giving me a present yield of about 4%. The best 5 year corporate bond I can find available to me as a DYI investor on TDWH yields only about 2.5% at. Why the difference. Should I be worried. I am 57 years old and approaching retirement and feel the need for some fixed and CBO seems the option. What to do about the fixed income portion. Sometimes I think for the fixed income component it would be best just to stay in an investment savings account which pays 1.25% and eliminates the risk of loss of capital.

Q: Hi Peter and Team, a small portion of my portfolio (5%) is made of CGL (Gold Bullion ETF) and Goldcorp. Because of CGL fees and lack of dividends, I am thinking of selling CGL and use the money to buy more shares of Goldcorp. Does this make sense? Regards, Gervais

Q: Hi, I would like to add a good monthly income or dividend oriented etf to a diversified portfolio. What would be your recommendation?
Thanks for the great service.
Phil

Q: Hi 5i team,

I know you prefer IWO for US Growth, but would you consider VBK (Vanguard Small cap growth ETF) a viable alternative? The MER is 0.10% for VBK.

Thanks.

Q: Hi folks, I`m a relatively new investor with a portfolio that I consider to be heavily diversified and Dividend Stock oriented. I recently made a contrarian decision and made a speculative play of 5% of my portfolio to Gold ETFs, just BEFORE events in the Crimea became relatively stable. Of course, my positions since then have been beaten down by almost 10%, but my original reason for investing in Gold was for the expected long term return after the last year of brutal decline. Am I being overly optimistic on the upside of gold stocks and am I better off staying on ETFs or should I consider investing in actual miner stocks? Sorry for the long winded question.

Q: Would you please suggest a couple of ETFs for a very young 1 year old lady just beginning a RESP.Because of withholding taxes on foreign dividends in RESPs it seems those ETFs should be Canadian and also for a long term hold.Thanks for a great service. Don.

Q: Hi Peter and 5i: I am looking at including a selection of convertible debentures in a reasonably diversified RESP that will likely not be used for education funding until at least 2022. I'd like to get the principal back, eventually, and to collect a decent interest rate within the tax-deferred RESP. I am more interested in using them to offset common equity risk from the stocks' side of the portfolio and less interested in their potential upside from the convertability aspect. Converts that seem unlikely to be converted sometimes appear to offer a decent deal on the yield side. But of course I don't want to enter any situations where there is a substantial chance of default by the issuer. With all that in mind, could you please give me your comments on Firm Capital's FC.DB.D? Thanks very much!

Q: Hi,
I am trying to understand currency hedging. This is from FFI.UN's description:
"Currency Hedge
The portfolio's US dollar exposure is hedged back to Canadian dollars to protect against currency risk."
Does this protect me against the CND dropping or USD dropping?
Thanks!

Q: BMO has a new bond fund ZTH floating rate bond fund. It holds treasuries, but uses credit default swaps and other things to get the high interest. What are the risks relative to the more common high yield funds, that holds the bonds directly?

Q: Hello 5i team.
I am looking at either
VDY - 2.68% Yield - Management Fee - .30% MER - .34% or
XDV - 3.86% Yield - Management Fee - .50% MER - .55%.

XDV has the higher yield but it also has the higher fees. Does this make any difference. Take the higher yield & pay the higher fees or take the lower yield and lower fees. It looks like VDY outperformed XDV past year.

Q: I have ACM COMMERCIAL MORTGAGE FUND as a holding in my RRSP. This has been a steady performer for the past few years. With fears of rising interest rates, would a fund such as this be adversely affected by rising rates in the future and if so could you recommend a suitable replacement for ACM (an ETF or possibly a Mawer Fund)which would have about the same performance but not be affected by rising rates. Thank you.

Q: Hello- regarding ETFs in general-
often Etf trade above their NAVs during the day, and sometimes for several days or longer. If the ETF issuing company is selling issuing and selling new shares above NAV, where does the extra money go?
Also, should the issuing companies not adjust the price to reflect NAV at least once/ day? I find it annoying to check the NAVS on the Horizon or ISHARES websites and find them different from the market price. Or am I offbase on this?
Thanks

Q: Are there ETF's that fall under the 'ethical' umbrella? If so, can you suggest some names for income, dividend and more aggressive growth?

I recall previous questions about ethical investing - a word search would be useful.

Q: Hi Peter..

Looking over the spousal RRSP...the account is down over $15 000. I have around $14 000 dollars to invest. The portfolio of some stocks include Canadian Oil Sands, Bombardier and Rogers. The rest is in mutual funds. I want to get as much capital appreciation as possible since the account is down so much. I am down on Bombardier but hate to sell it...I think I have a $2000.00 left at mark value at this time. Should I sell bombardier? In what stocks or stock should I invest in. Remember I want as much capital growth as possible, while still investing in solid comapnies. While reading your responses from other questions you have mentioned some of the following companies:

AVO
Syz
SGY
CXR
STN
CSU
VRS (I have some already in other accounts)
DHX (I have some of this in other accounts)
AYA (lookin to buy in other accounts)
or does something else seem more fitting??

What would you do in my position? Thanks for your time and knowledge

Derek

Q: I would like to diversify into the US pharmaceuticals. Which would be reasonably good value for a 5% position in my portfolio and reasonably safe as in low volatility: VRX, GILD, ACT or IBB or would you suggest something else? Thankyou.

Q: For a young new investor just starting a RRSP, in which product would you accumulate initial savings? Would something like XWD be an appropriate starting point, and how much would you accumulate before diversifying to a typical portfolio approach.

Q: I have a well balanced 5I style portfolio, Thanks. Regarding my US holdings I have SPY, EFA, IBB, IWO, VIG, TAL, YUM, XLY, AAPL and a little US cash. Apple is flat, the rest have been fantastic. What do you think about selling Apple and buying something tech like such as QQQ with about 4% of my US portfolio? If you think this is a good idea is QQQ the choice or something else in any sector?