Investment Q&A

Q: Hello,

From your last report update of March 9th the 5i Balanced portfolio is down YTD -7.18%. Mawer's Balanced fund Series A is also down YTD -7.15% as of March 30th (according to Morningstar data). I find the comparison between the 5i balanced portfolio and the Mawer Balanced fund interesting because the Mawer fund has a Canadian bond weighting of ~30%. Given the current market back drop shouldn't balanced funds with a sizable bond weighting provide better down side protection? Or is this mainly due to rising interest rates affecting bond performance?

Thank you,

Glen

Q: I have owned a few perpetual preferreds for quite a few years. Now that interest rates are going up, some of them (particularly the ones with Canadian Utilities) have been declining. I should have sold them earlier this year but did not. What do you think perpetual preferreds will do in the coming year?

Q: I have $ 300 K US to invest . Can you suggest safe investments that would be covered by CDIC. My time frame is 1-3 years. Thanks

Q: I have about half of my balanced income portfolio in equities and the remainder in cash. Although my stocks are balanced, I still hold no fixed income investments. I like the sleep at night cash but feel it is too big of a chunk to just let sit in cash., Can you please suggest an approach to fixed income and recommend a few possibilities to consider. As always, thanks for your help

Q: Hi,

For fixed income, from your Q&A, it still make sense to have some holdings in inflation protected bond funds. In your opinion, would it be a good idea to shift most bond holdings into funds like these until inflation abates? What are your favourite inflation protected funds in the US and Canada?

Thank you, Michael

Q: My fixed income holdings are comprised of - LYZ801A & MMF559.
I am with a full service advisor - up until a few years ago we bought individual bonds - then on his recommendation switched to these funds. What is your opinion on their performance. What are some alternative better performing mutual funds and ETF options or should a person go back to buying individual bonds? I read an opinion that said with individual bonds (held to term) you get the principal and interest with funds not so much. Your expert opinion would be appreciated as usual.

Thanks

Q: Hi 5i team,

As many do, I currently hold part of my portfolio in fixed income (bond etfs). I am wondering if you can recommend any fixed income or "fixed income like" investments that might hold up best in the current rising rate environment that seems to have a long way to run. I had held ZAG but have switched to VSB with rates rising. Currently even cash is doing better than these however. Thanks!

Q: Hi, could I please have your opinion on the long end of the yield curve. The consensus seems to be that economic growth is starting to slow, inflation is increasing but may moderate in the second half but remain sticky and that the Fed may make a policy mistake by over tightening. To date the yield curve has steepened, short and long yields have increased, shorts more than longs. How might you see this playing out going forward. Do you think the long end of the curve presents an opportunity at this point? I am considering long perpetual preferreds which have also corrected but offer more generous tax favoured income (around 5%) than long bonds? Many thanks.

Q: What would your bond ETF pick be for a 2 year holding period? I have been using XSB and CLF.

Q: According to a G&M article on treat of stagflation, XSB is not a good choice of invest re 40-60 portfolio.
Assuming you agree with this article what would be your top 3 or 4 investment to replace XSB ?

Q: Hello Peter and team,
Would you be kind enough to explain how the 20 year Tbond ETF works please in relation to interest rates and or inflationary environment? Thanks very much.

Q: Hi Team,

I realize this question might be off the beaten track but was hoping you might be able to shed some light on the implications of holding a debenture issued by Cominar now that it is experiencing a change in control in favour of Iris Acquisition II LP.

I have received a corporate action notification that I have an option to receive $1010 CAD for every $1000 CAD principal amount of Cominar Real Estate Investment Trust 4.5% Series 11 Senior Unsecured Debentures due May 15, 2024 tendered. With no action on my part, debentures in respect of which the Optional Put Right is not exercised will remain obligations of Cominar under the terms and conditions of the Indenture and will continue to accrue interest in accordance with the terms of the Indenture.

Any idea in plain english if the debt obligation has a higher risk profile to the holder if the option is not taken? If you were the holder, would you exercise the option or do nothing?

Many thanks.
Michael

Q: Will XSB keep going down so capital loss is greater than return in interest?

Q: Considering selling ZAG at a small loss and buying XSB for more stability.
Your thoughts would be appreciated. Thank you.

Q: I have had exposure to this fund since inseption and would be very comfortable investing under 8$ .
Can you explain why the sudden dropp.
I assume some Russian exposure.
What are your general comments about this fund.
Thank you!

Q: with interest rates rising and perhaps the yield curve flattening what is your opinion of this preferred share etf
thank you

Q: Peter,

Go on the assumption that we will be in for a period of slow and consistent interest rate increases. I am very interested in how a bond fund could possibly increase the NAV during this period. For every uptick in the rates every single holding, whether of a short or long duration loses value. Do you agree ? What could a fund manager possibly do during this period to actually increase the NAV? I guess I am interested in the tricks of the trade or is it simply grab the umbrella and hope the rain eventually stops.

Thank you

Paul

Q: Hello 5i
We're curious about FLX (formerly FLOT)

Held since 2018Dec it was up ~2.85% including Interest pmts at 2021Dec31
Since then it has further dropped and we are now down ~2.0% (including interest pmts)
Would appreciate your opinion whether this is due to the change in its
investment objective introduced in December, or is it more related to the market
scenario since then.

Would you recommend holding or exchange for some safer bond ETF ?
If the latter could you please provide a couple of examples

Thanks for your guidance.
Terrance

Q: Have these ETF's in my portfolio for at least 5 years. With the current interest rates environment... keep or swap? If swap which one? What would be a better option?

Thanks for your great service

Kevin

Q: Hi 5i,
I noticed ENB and TRP have both recently issued long bonds out to year 2052/2082. I don't understand the strategy of a 30yr/50yr bond, please explain. I think these were issued to repay a series of "Preferred Shares", which looks to me to be a bit broken. Can you tell me how many other companies are doing this?