Investment Q&A

Q: What is your best recommendation for a US dollar and traded bond etf that holds short term bonds of around 2 year duration that can be held for 12 to 24 months that would benefit from a thesis that interest rates will fall during the next 12 to 18 months. I have never held bonds, have US cash and would like to on a lower risk basis park current money market funds into a bond etf that preferably does not pay dividends but can appreciate capital based on a combination of shorter term bonds gradually coming due and interest rates falling. Thank you for providing some direction and suggestions since I feel rather lost in this area of investing.

Q: Which of these fixed income holdings is best suited as the 25% fixed income in a retirement portfolio? Alternatively, is a 30/30/40 mix (for a portfolio total of 25%) better? Thanks!

Q: Hi,
I am looking for your opinion on this stock and ETF. The stock is listed as the 11th holding in the ETF for regional banks, KRE. It caught my attention as it seems to be breaking out of a long term base. Also is JNK a good ETF, and if not what alternatives would you suggest that pay a decent dividend. Would I be right is thinking JNK will be negatively affected if interest rates begin to drop? Deduct credits as you feel appropriate. Thanks - your advice and insight is always appreciated!
Dawn

Q: Right now a large % of my portfolio is in TD 8150 money market paying 4.55%
If rates start to drop it will be hit right away---Some corporate bonds are paying over 5%---I like the liquidity of the 8150s and will continue being in fixed to perhaps a lesser extent---do you think I should lock in one of these corporate bonds for maybe50% of what I have in 8150s now?
Thanks
Peter

Q: Is this a good time in our current economic cycle to buy US high yield bonds, with the US economy still on unstable ground? Or am I better buying a Canadian high yield dividend ETF? Income investor and will be held in a registered account.
Thanks!

Q: Hello,

I am looking for a regular dividend paying fixed income bond ETF in Canada. I have a 5 year horizon. What would you suggest ? I currently own CBO.

Thanks.

Q: I have these in a robo managed portfolio and am down 25% on ZFL and 5.4% on ZAG and 8.2% on XSH.
Since it appears interest rates appear to be stabilizing should one hold on for a recovery or try a different strategy or different holdings. Perhaps maybe moving to GIC or HISA EFT or other holdings you may suggest. Or do you think the same recovery may be seen by continuing to hold?
This loss seems to be an issue with those that have to go managed funds and mutuals with a balanced EFT portfolio.
I am going to transfer from so called managed to my own managed EFT's to avoid the fees. Think I can do just as well (or poorly depending on how you look at it) but wondering if I should switch holdings when moving funds to self directed EFT's.
I do have a separate portfolio with individual stocks, so this is basically a portfolio to minimize management and time requirements.

Q: In your bond answers you favour XLB.
What are likely scenarios for this ETF if say rates only drop to high 4% and stay there?
What potential upside are we looking at?
What dividend rate should I expect?
What happens if the rates drop at much slower pace?

Q: How to explain the (unusual) stock 1.86 % decline from 107$ (fév.,. 2023) to 103$ (march 2023) ? since the only factor that I was considering when investing into this ETF was the premium, are there other factors to take into account in order to avoid a similar situation ?

Q: I am looking for a few suggestions for high quality corporate bonds that will mature in around 5 years. I tried using TD's fixed income tool to do research, but it seems like the selection of bonds on offer is artificially limited. Can you suggest a few bonds or direct me to a website that would allow me to better research them myself?

Q: Hello
I have equal amounts in CLO and CLF. Wondering if it might be a good idea to swap one of these for the longer term XLB Bond Fund to hopefully play the downturn in interest rates? If so which would you swap and why? Is there a safer trade with equal potential with less risk then XLB?
Thanks
Jeff

Q: It certainly feels as though we are seeing the beginning of a new bond bull after the roughest two years since the 1980s-early 1990s.
Please provide you opinion on the above, as well an any other bond etfs that you follow.
Can you please provide you opinion regarding a bull market..
Thanks in advance
Rick

Q: I intend to invest a significant amount of cash ETFs in my TFSA ,could you suggest a list of safe ETFs with interest,or even short term bond ETFs if pertinent with this objective,aiming at preservation of capital and 4% + to 5% revenue, would it be better to hold just one ETF or a mixture is better in this context,many thanks for your excellent work

Q: Is it possible to choose a favourite for a 1-1/2 to 2 year hold with the expectation of a reasonable yield while rates remain near current levels, and a capital gain as (if) they begin to fall?

HBND vs XBB or something preferable?

I'm assuming they all provide yield that will be treated as interest and not eligible divs. If so, preferred account type?

Thanks,

Q: Hello 5i,

Is there a downside (15% tax) of owning US bonds such as VCIT, VCLT, TLT, AGG, in an RRSP. If so, can we apply for an exemption for an RRSP? If not, would you switch to XTLH instead of TLT? Are there can-hedged ETF's for VCIT, VCLT, AGG?

Thank you

Debbie and Jerry

Q: Your thoughts on a switch from PSA.to to XLB.to?
Thank you.

Q: Could you comment on the relatively new option-based US treasury ETFs HBND and HPYT. The yields have caught my attention, together with the underlying security of US treasuries and the possibility (?) that rates have peaked. Do you see these as being suitable up to around a 1.5% position in an RSP, and is there US tax withholding on the distribution in an RSP? How do these compare to TLTW (I would prefer to buy a CDN$ ETF rather than take the hit on conversion) Do you have a preference, and would you buy today? Note that I already hold about a 2.5% position in ZLC, which is up marginally.
Thank-you

Q: Good morning 5i
I am getting older and not sure i want to endure too many more stock market roller coaster rides. I am therefore thinking of moving into a higher bond allocation. You have mentioned yourself that even something like tlt could be a roller coaster. I am not adverse to getting some but I would like to know from you, what bond etfs you would recommend if one wanted , for instance, a 40/60 split between bonds and stocks. I am open to Canadian, too, but my intention is to keep fixed income in our rif, therefore, i would concentrate more on us bond etfs
Thanks as always

Q: How are capital gains taxed? Should it be in a TFSA or not. Greetings, Peter.

Q: Hi Peter, With all the talk going on about rate cuts next year, what is your opinion on parking cash as part of fixed income. Should one go for 1 year or 5 yr ladder GIC. This is what i got from TD branch although website is way lower.

1 year GIC – 5.90%
1 year GIC – 5.90%
2 year GIC – 5.60%
3 year GIC – 5.40%
4 year GIC – 5.20%
5 year GIC – 5.20%

Thanks