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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: I would like to park some cash, with the eventual purchase of a residence and am interested in more than GIC's and I understand that this will entail more risk, though less than equity risk. What do you think of MFT, XHY, PYF, PSA, HFR and PMIF and would you split them in equal percentages?
Thanks for your service
Read Answer Asked by Ozzie on August 21, 2020
Q: I have a GIC maturing today in my RRSP. I am looking for an alternative fixed income choice as all GIC rates are now again abysmal. Any suggestions or would it be just as well to take a high dividend yield from one of the Canadian banks, telcos or utilities?
Read Answer Asked by JEFF on August 12, 2020
Q: I listened to a commentary where the analyst was suggesting one have a bond fund, in this case US, which receives income in a foreign [non-US] currency and then the fund converts that to USD. As the USD depreciates from QE relative to other currencies [if this happens in reality] the inflow to the bond fund will be worth more in USD. Is that a logical approach and would Vanguard’s BNDX be an appropriate? Even if the above is a stretch would holding some of one’s bond allocation in BNDX be prudent?

Thank you.
Read Answer Asked by Ronald on July 31, 2020
Q: TD securities is offering a structured note product TD GDXJ ETF autocallable coupon notes It is linked to the junior gold sector
Could you explain how this note works and what are the downsides and upsides to this note I am thinking of purchasing some
Thank you for your response
Paul W
Read Answer Asked by Paul on July 29, 2020
Q: Looking for a low volatility money market fund for a short term to 3 year hold. What would you recommend please?
Read Answer Asked by Joel on July 28, 2020
Q: Hi 5iTeam,
I noticed that when the markets pulled back in early to mid March this year, both bond ETFs: XLB (approx. -28%) and XSB (approx -9%), pulled back as well although there were no movements in interest rates. I would think that these bond ETFs are a good proxy for cash, then what would investors' reason be for selling? Your comments on this would be much appreciated.
Cheers,
Read Answer Asked by Harry on July 17, 2020
Q: I am planning to increase my bond exposure in my RIF and have looked at VBU. I already have Canadian bond exposure. This is a hedged fund. Is this, as a hedged fund, appropriate for my RIF? Is there an unhedged equivalent? Do you have other funds I should review?

Thanks
Read Answer Asked by Ronald on July 17, 2020
Q: Hi,
This is about parking one's cash.

I know I have "slightly" less cash than Mr. Warren Buffet :))

But whenever I read that people like him have 134 BILLION dollars in cash or other Mega rich people sitting on the sidelines with literally hundreds of Millions of dollars, I have always wondered where these ultra rich people park their money?!
We the ordinary folks are struggling to get 0.65%. The same for them too?

Your answers have always suggested GICs, High Interest Savings Account and ETFs like PSA and very rarely Income ETFS/Mutual funds.

Any new suggestions?
Read Answer Asked by Savalai on July 15, 2020
Q: Looking for a safe place to park my Moms Money. I was thinking about XLB , but the risk reward there is crazy in my view.
The draw down the way i see it was around 26.5% back in March, this to me looks like the Bond Market isn't functioning properly. She currently owns Scotia Innova Income portfolio which pays a distribution of 3% . The draw down in that fund last March was around 8% i believe, this to me not making much sense either when comparing it to XLB
Considering the issues mentioned above, Does purchasing GICs seem rationale to you considering these crazy times.
Thanks !
Read Answer Asked by Gordon on July 08, 2020
Q: I am currently reviewing my mother's non-equity portion of her retirement portfolio. She currently owns CLF, ZAG and short-term GICs. The interest from these investments are not needed for immediate living expenses. The non-equity investments in her portfolio serve to reduce volatility, and provide peace of mind.

Everything I have read recently indicates that interest rates have likely made a long-term bottom. As such, I am wondering whether my mother should sell ZAG and keep her interest-bearing investments in short-term, secure instruments only (i.e. CLF and GICs). In short, should she be staying away from mid-long term bonds?

Jeremy Siegel recently recommended that retirees should modify the traditional 60/40 stock/bond portfolio to 75/25 going forward because he does not anticipate good returns from longer-term bonds. Do you agree?

Many thanks for your thoughtful and valued insights.
Read Answer Asked by Dale on July 06, 2020
Q: I have been keeping a lot of money out of the market for most of this year waiting for stability to return. Bonds seemed to be pretty much a pointless investment to me for the last few years but I've reconsidered. Putting a chunk of cash into a bond etf seems better than just leaving it in my account where it earns next to nothing. On the other hand, it's safe where it is. How safe are bond ETFs? I'm particularly thinking of bond ETFs which don't seem to bounce around much like BLV, VLB, and XLB, but which seem to have done well YTD.
Read Answer Asked by John on June 29, 2020
Q: I like the Vanguard family of ETFs and am looking for safe income in these uncertain times. I am aware of VBAL and VGRO, but could you suggest other Vanguard offerings that focus on earning investors relatively safe distributions. If there are other companies that offer superior ETFs for income I would appreciate your suggestions.
Read Answer Asked by Les on June 17, 2020
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