Investment Q&A

Q: On Dec 28 you responded to a question from Cal about covered call bond funds, and made a recommendation as he requested. However, in your comments I got the impression that you felt now may not be the right time to buy this type of fund due to the potential for higher bond prices and lower yields over the coming months. Looking at the 2 noted above, and assuming rates do start to slide down a bit, what would you expect to happen to the ETF price and the distribution? Would you be a buyer today?
Thank-you

Q: Regarding CASH and similar etfs:
Couldn’t the price fall if/when interest rates decrease?
I realize that in such a scenario the price may fall below NAV, but potential buyers may not care until the price falls low enough for the yield to be attractive. In this way, it seems as if they could trade similar to a long bond. If so they could hardly be considered cash alternatives. Your help in understanding this, please.

Q: Morning 5i;
If you have for an example $50K in a PSA or HISA account and you have that same amount on the 30th of the month ie x-dividend date you will get the full amount of the interest payment the next month a few days later . My question is if you had of taken out say $5k after the first two weeks of the month say the 15th , do you receive any interest payment on that $5k for the first 15 days that it was in the account OR do you only receive an interest payment based on whats in the account on the 3oth ?
Thanks
Bill C

Q: Happy Holidays,
I have a question about tax efficiency on HISA ETF investments in non-registered accounts. Do the dividends received from these ETFs qualify for any dividends tax credits? Or are they being treated as interest income, such as GIC, which will be subject to the usual marginal tax rates?

Thank you,

Q: Hello, can you recommend a USD money market fund that can be purchased on the NYSE? I hold ZMMK in my CA portfolio and looking for a US$ equal. Thank you.

Q: This ETF has been trading sideways for the last 3 months. With a 5.5% yield, isn’t this stock supposed to gradually increase? I understand there’s a slight premium associated with this ETF, but it’s not really moving much at all

Q: my position in XLB:CA has almost recovered to break even. i am adjusting my behaviour in investing to try to avoid betting on conditions such as rising , falling, or staying near current for longer. I am getting the feeling from comments that long bonds are a play on rates dropping. If this is true, i would rather be positioned in bonds for more balanced risk/return regardless of rates. Any suggestions ?
Many thanks for your great service!

Q: Hi 5i - could you imagine the excitement for all these years, mine and all members? Only blessings for you, Peter, and your 2 families : Lara and the kids, and all your office.

Now about the pain caused by SCHP and QTIP (down after 2 years 16% and 22%) No one understood how on the earth, instead to protect against the inflation, they never did what they were supposed to do.

I found this info:

BlackRock does offer ETFs that hold TIPS to maturity. For example, iShares iBonds Oct 2028 Term TIPS ETF (IBIE) owns nothing other than TIPS maturing in 2028. And the ETF will hold those TIPS until they mature, and then the fund will liquidate, distributing cash to shareholders. So it works very similarly to just buying 2028 TIPS on your own and holding to maturity.

This for a 72 ys in RIFF.

Apart the AUM small, small volume, what do you think?

Thanks for ever.

Q: this is a gold rated etf with morningstar, but if relied on for retirement income , what are chances the distributions could drop well below the current stated 6.4 %

Q: Rick Reider is managing BRTR a new income etf. Does it pay a dividend or does it operate as a total return instrument? Are there any income etf's trading in the US that instead of paying a dividend provide capital gains instead similar in result to the corporate class structure from Horizons? Lastly does Horizons have any US dollar income etf with a corporate class structure and if so would you recommend it? Thank you.

Q: Since long duration bonds have more sensitivity to interest rate movements and interest rates are expected to decline next year does it make more sense to invest in a long term bond ETF? And since I expect interest rates to fall further in Canada does it make more sense to go with a Canadian ETF? Which ones would you recommend?

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 ?