Investment Q&A

Q: I really don't understand how bonds work.
But I sense there is a good opportunity to purchase bonds now that interest rates are close to peaking.
It took me about 2 years to come to an understanding of the stock market. My first stock purchase was a pretty frightening experience, and the next 10 or so were not much easier.
I'd be grateful if you can guide me to some good literature which I can study on bonds and which also covers the current market backdrop.
Thanks a lot.

Q: Can you please help me understand HISA ETFs - for instance, I see HSAV dipped down to $108.75 on Oct 30, then bounced back up. In an ETF where there are no distributions, what would explain the dips? In theory, shouldn’t it continuously increase in price?

Q: Hi Team
Would you advise HYGH as a small position (2-5%) for RIF income. With the rise in interest rates , its hedging seems to have protected its unit value and should continue to do so if there are further increments upward or is it just too risky for an older guy. Best Regards. gary

Q: a) Is it risky to purchase a corporate Bail-in Bond? Even if they have been rated as A or A-?
b) Can you explain what a bail-in bond means from the purchaser’s (my) point of view?

Q: Hello 5i,

David asked a question about timing a purchase of TLT. The answer indicated now was a good time but the recommendation was to buy an aggressive bond. Can you list two examples from the US, CAN, and 1 from a global perspective that would meet the description of an aggressive bond?

Thank you,
D&J

Q: What is the present yield and MER of above fund? I hold this fund presently in a U.S. managed account.

Q: Your response to "Alex" on October 23, 2023 and today's National Post article by David Rosenberg are very positive for the immediate success of TLT. Given its reasonable payout, it seems worth waiting for a turnaround; however, its recent performance has been abysmal. Timing thoughts? It is a worthwhile long-term hold?

Q: XSTH, QTIP, or ZTIP - which do you prefer for TIPS etf in CAD and why? Feel free to include another CAD name I've not mentioned if applicable

Q: my debentures have traded down to 120.
what should I do with this large capital loss and what is the future of these debentures for current holders? appreciate your analysis and direction.

Q: What is the best denominated US TIPs etf?

Q: I am looking for a fund to hold U.S cash in a U.S. managed Account.
What are your thoughts on NBC201? Are there any others that come to mind?
What is the present yield and MER of NBC 201 and others you might suggest.

Q: What is the present yield and MER of the above funds?

Q: I'm considering Harvest Premium Yield Treasury ETF (HPYT.CA), US treasury Income, high yield through covered calls; very aggressive Yield of approximately 15% and 0.45 mgmt. fee; new ETF to the market, anything one should be aware of here good or bad? Thank you & keep up the super work!!

Q: RE purchasing US treasuries

Hello 5i,
Once or twice I have tried to purchase bonds from my discount broker RBC direct investing. The process to purchase is fairly easy (you will face a hit up front on the bond price compared to the open market). However, when selling a bond or treasury that's when a DIY investor is really at a loss. You call up RBC and then the agent will consult the "manager in the bond department" and they will decide on a price they will give you for the asset you wish to sell. Kind of like a car dealership! It truly is a grey market where your discount broker has all the control of the sale of that fixed asset. Also, if looking at treasuries, you must commit to $10k USD and can't buy, for example in smaller increments, like I wish to do for a family member in a conservative TFSA.

IS there an ETF suggestion for a 10, 20 30 year treasury in USD? Not what i really want, but will mirror the moves in this market, I suppose? TLT is the 20 year. What is the 10 year, 30 year?

Also, can you confirm that the interest paid on the treasury would be tax exempt if held in a TFSA? If tax on interest is exempt in a TFSA, would it still be exempt if one holds the ETF and not the treasury itself?

Q: I need to sell 1/3 of my portfolio and park the cash for 3-6 months. TD will not allow me to buy PSA, CASH, HISA, or HSAV. Can you recommend a few other good options.
Thank you,
Derek

Q: In the event of windup, dissolution, liquidation, where do the various debt instruments rank with respect to each other ie. bank debt, debentures, notes and preferred shares? When there are several debentures, notes and preferred shares outstanding, how do they rank with respect to each other?

Q: Do you think it is a good time to add bonds? It seems the most likely scenario's (slow growth with moderating inflation like now, or full blown recession) will be more favourable to bond investors than equity holders. What is the asset mix you would employ and do you favour longer bonds today? Thanks.

Q: I am a retired income investor and I purchased this ETF several months ago for income and some potential growth. It is in a registered account. The payment is reasonable but I now realize that I don't fully understand how this will react to interest rate swings compared to either short or long-term bonds. Should I expect it to have a higher beta than longer-term or shorter-term bonds? Would it usually react fairly quickly to anticipated interest rates move or because there is an equity component does the state of the economy (aside from rates) impact its value, resulting in slower swings? Would you consider it riskier or "safer" than "straightforward" bonds?

Appreciate the insight.

Paul F.

Q: Could you comment about Ninepoint High interest savings etf

Q: I currently have positions in HYG ( a bit underwater but no reason to sell) and am considering switching HYG for TLT. The current yield is lower, it seems, but the chances for a long term gain look more inviting. Your thoughts on TLT would be much appreciated. Good idea to switch?

All the best

al