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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: Hello Im wondering if you could name a couple of USD traded etfs that would be as close to the equivalent of PSA or CASH but trade in USD either on a Canadian or US exchange if necessary. Thanks

Read Answer Asked by Scott on January 24, 2023

Maturity May 1 2029 Coupon 6.55

Maturity Nov 9 2039 Coupon 6.75

I took in charge this portfolio and did not sell those positions to avoid loss on capital.
Very large position in 2 titles ( 25% + of a non registered portfolio alltogether),with 10-15% capital loss on paper.The objective of this portfolio is safety and long term revenues.Are those investment safe for long term ,and are the 6.55 and 6.75 coupons excellent numbers in the present context of rates etc..? many thanks J-Y

Read Answer Asked by Jean-Yves on January 23, 2023

Q: Greetings 5i,
I am retired and typically don't have much in the way of fixed income since we have decent pension income, dividend income from a non-Reg account and some income from our RRIFs (started early to postpone CPP).

However, there is likely opportunity now for short-term bonds (higher yields as bond prices have fallen) and long-term bonds (capital gains when interest rates start to fall). Could you please identify two Cdn bond ETFs that would satisfy this rate dumbbell scheme?

Thanks as always for your excellent service.

Read Answer Asked by Steve on January 23, 2023

Q: Hello 5i Team
Last year stocks and bonds both had a down year, I would like to add to a fixed income ETF that you think would have upside the next few years as interest rate starts to pause and decline in the future. I currently own a position in Vbal etf which has bonds component in it.

Read Answer Asked by claudio on January 23, 2023

Q: What are your favourite Canadian bond ETFs given the current circumstances and looking ahead a couple of years.
Thank you!

Read Answer Asked by Carlos on January 23, 2023

Q: Hi Peter & team:
IF I buy CSU.DB today at 138 $ and tonight CSU makes their recall announcement , the baystreet computers will grind away for about TWO milliseconds and tomorrows opening price may very well be about 115$ to 118$, and THEN a gradual decline to 100$ over 5 years.
My question is do you agree that this debenture is riskier than it appears since new buyers after the announcement will also expect to make money during the 5 year roll-off. Please poke holes in my theory if you wish...

(Of course the 5 years could also start in 2035 ...)

Read Answer Asked by Grant on January 20, 2023

Q: Where to hold Bonds? As I am winding down my income producing years and shifting to drawing down my savings I am wondering where I should hold bonds. We currently hold no fixed income as we will get a pension from my wife's work when she retires( so historically considered that out fixed income). Bonds haven't really been on my radar with rates so low the past 10+ years but things are changing both in terms or yield and my investment needs. I have 4 options to stash some bonds TFSA, RSP, unregistered and within my Inc. I more or less have things in the right place currently with growth in TFSA, US in RRSP and CAD in unregistered accounts. My plan was to sell some USD large caps once the steam runs out of the current rally and buys some high grade corporate bonds, in or around 10-15% of my portfolio. A bit of the old traders strategy of sell in may and walk away...

So to circle back, the easiest place to do it would be in my RRSP, but some of the reading I have done has suggested I do it in my TFSA as I can get the yield out of the TFSA tax free account at any time instead of locking it in the more restricted RRSP accounts. Shifting the TFSA from growth to income also seems like an appropriate move at this stage nearing retirement ( me semi-retired, my wife in 4 years or less). The 3rd option I am considering is doing it in my INC and using the yield to " pay the bills" so to speak of keeping the Inc cash flow positive as my earning drop with me working less.

Read Answer Asked by Tom on January 20, 2023

Q: I hold convertible debentures from Invesque IVQ.DB.V, maturing 30 Sept of this year, but which are only trading at 80 cents on the dollar. This seems to indicate that there is a substantial risk of default. In your opinion will I get my principal back or will I be given newly-issued and hence highly diluted IVQ shares? Thanks!

Read Answer Asked by Gregory on January 20, 2023

Q: I have already asked a question about this security. Thanks very much for your answer regarding the payments being interest and not dividends.
I just can't understand this security. It is an inflation linked bond with a maturity date in 2040. The new year's interest rate has been announced as 13.3% based on the 100 bond price. The current face value has declined over the last week even though the interest rate has gone up by just over 2% per year. The current rate on face value of 137 is 9.7%.
I know about the thin trading volume and the potential for Constellation to redeem the bond with 5 years notice.
What am I missing?? Is there a good reason not to put a fair chunk of fixed income destined money into this debenture?
Thanks as always for your insight!!

Read Answer Asked by Richard on January 19, 2023

Q: With interest rates rising and bond yields now almost at levels worth looking at I want to start adding a few bonds to my portfolio. Obviously the easy thing to do would be to buy a few of your recommended bond ETFs but I would rather buy and hold individual bonds over bat for the average with an ETF. Can you recommend some good reading material on the subject of building a self managed bond portfolio. I understand the basics, looking for a slightly more advanced guide for a DIY investor.

Read Answer Asked by Tom on January 18, 2023

Q: To full fill RIF withdrawal obligations, I am seeking high yield vehicles and found HYI, ZHY and ZJK, they all have above 6% yield. HYI is called active high yield bond ETF even has 7.33% yield. Does active high yield more risky than other two? What do you take on these ETFs if you are a yield seeking investor? Thanks. Lin

Read Answer Asked by Lin on January 18, 2023

Q: Hello,

What is the difference between PSA and CASH?

Also, I own ZCS and CBO and was wondering if I should increase my allocation to CASH and PSA while reducing my allocation to ZCS and CBO considering the higher rate (better yield) on the short end of the curve. It seems to be higher income / lower risk strategy. Can you please provide your comments. Thank you.

Read Answer Asked by Pierre on January 17, 2023

Q: Bond market drives the stock market.

I keep hearing this message. Would you please provide a explanation of why this is the case ( if you agree) and how this works. And WHO are the drivers of the bond market.

Thanks as always.

Read Answer Asked by Donald on January 16, 2023

Q: I have some cash that I was thinking of putting into PSA or CASH for the shorter term. But I am wondering if the unit price of those may drop suddenly when the market turns bullish, and investors move back into stocks. So, well I may earn a nice yield, I could lose some capital. Is that something I should worry about? Thanks.

Read Answer Asked by Kim on January 16, 2023

Q: Last week Horizons issued press release indicating they were suspending new subscriptions after reaching approx. $US 775 million in assets.
The release says that during a period of suspended subscriptions , the Manager expects the shares of HSUV.U to trade at a premium to its NAV per share . While new subscriptions are suspended , Horizons ETFs is strongly discouraging investors from purchasing shares of HSUV. U .
As of today , the price and NAV are within a few cents of each other.
How should this press release be interpreted ?
Is it just a formality ?
Or should you be listening when Company issues a caution on its own product ?

Read Answer Asked by William on January 16, 2023