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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: Peter and team: I want to sincerely thank you (!!) for your service--from a long time BNN viewer, avid reader of Peter's published articles, and very, very enriched long time 5i subscriber.

It is difficult to think of how 5i could be meaningfully improved. The responses to subscriber's questions in particular have terrific value when The questions are short and focus on one or a couple stocks, and I read the incredibly well thought out responses with keen interest, and have acted on these responses many many times over the years, profiting handsomely as a result.

I have one small suggestion to some subscribers. My wish would be for those offering criticism of 5i--David's recent remarks on Peter's endorsement of high flying TTD is top of mind-- to refrain from criticism of 5i's picks. If you are unaware, Mr Hodson is one of the very, very best in his field in Canada, full stop. He has made serious money from momentum plays. Your idea that TTD is too expensive is your perception and if Peter is endorsing it currently odds are you will likely be proved wrong, not Peter.

For a very modest annual sum we, the subscribers, have access to his thoughts on securities and the market. If you act accordingly on his recommendations, you will be rewarded over time.

To those who occasionally use the Q&A feature to be critical of research offered by Peter, on behalf of (Im sure) many subscribers, please, we don't want to have to filter through criticism, we want instead, ideally, just short, pointed questions on Peter's opinion regading say, one or two stocks at most.

Finally, those who ask long winded questions, or questions involving a dozen or more stocks, or those subscribers who occasionally angrily vent that a stock that was recommended lost altitude (that is part of the game folks) please consider the hundreds ? thousands? Of us who read these questions daily and are craving quality questions to elicit meaningful responses from Peter along our financial journey. Let's continue to give Peter reasons to continue operating this amazing service and continue personally responding to many of our questions by being reasonable subscribers as many, many of us are.
Read Answer Asked by Vicki L on December 24, 2020
Q: This is more of an observation than a question. I am disappointed that you are now recommending "nosebleed" momentum stocks like CRWD and TTD quite often, and went so far to to include some of these momentum stocks in your answer to a question about which US stocks you would add today. In my humble opinion, buying stocks with astronomical valuations that are already up 10-fold or more from their 52 week lows is not normally a good recipe for investment success. It would be especially imprudent to buy such momentum stocks that are not even profitable and trade on the basis of Price to Sales. On the other hand, it is good that you are disclosing your personal ownership of many of these nosebleed stocks: I hope that you will also let your readers know when you sell...
Read Answer Asked by David on December 23, 2020
Q: Hi
Besides the amazing science a lot of great investment ideas here. Protein predictors AI grabbed me.

https://www.theguardian.com/science/2020/dec/20/the-virus-free-scientific-breakthroughs-of-2020-chosen-by-scientists

Best of the season to all.
Read Answer Asked by Gerald on December 23, 2020
Q: It would be good if you had a page that provides an overview of your different products.
I see you have a $50 +/- upgrade to the basic 5i called Research - I can't find anything on the site that describes the value it provides.
Read Answer Asked by Delbert on December 23, 2020
Q: Hi Peter and team:
My question is about Drips and more importantly discounts on drips. I have had IPL for a number of years, and at one time they offered a discount. I truly believed, and was told that I was getting the discount on reinvestment. My shares are held in my RBC Direct investing account. I now read that this is an Rbc synthetic drip, and the only way to ever get the discount is to hold the shares in your own name. In a RRIF this would be impossible. Please fill me in on my lack of knowledge. Thanks, BEN.
Read Answer Asked by BEN on December 23, 2020
Q: I wanted to respond to Roy's concern that the answer I received from TD Waterhouse was a "load of crap " as I believe it could cause a lot of concern among your members that they are being cheated by their online brokers. The best way to do this is with math - Lets say that in total  TD WaterHouse  held 101 shares, split with 19 clients holding 5 shares and 1 client holding 6 shares.  Their total of 101 would be rounded up to 152 shares in the 3 for 2 split and that would be what TD Waterhouse would receive from BEP.  If you look at the clients accounts separately the 19 people would be entitled to 7.5 shares - 7 physical shares and cash for the .5  and the one client with 6 shares would receive 9 shares post split  for a total of 19 X 7.5 + 9 = 151.5 share equivalent in compensation..... So if the total number of shares that the broker holds in trust is an odd number they are making at most .5 of a share - not .5 of a share on each client as Roy implied. As well its the only fair way to treat us. I would be upset if I was the guy holding 6 shares as I am getting 9 shares or 1.5X the number of shares post split whereas if the guy holding 5 shares was rounded up from 7.5 to 8 shares he is getting 1.6 X the number of original shares. Nothing looks deceptive or dishonest to me.
Read Answer Asked by Scott on December 22, 2020
Q: Good morning Peter and team,
I know you have answered this type of question in the past but I have tried multiple options in the Search by text function without any luck.

Do you have any recommendations for reading material for a young adult new to investing? In particular, I am trying to steer him away from thoughts on getting rich quick by picking stocks he sees marketed by youtubers or "stock gurus" hawking their ideas on the internet.

Many thanks,
Rory
Read Answer Asked by Rory on December 22, 2020
Q: I would like your opinion on crypto currency - in particular the one that is available at wealthsimple. I don't know much about it but it was recommended to me as a potential opportunity. Is it something that you would recommend for your portfolio and is it expensive right now?
Read Answer Asked by Mary on December 22, 2020
Q: This year there have been a lot of companies that have made huge gains, and are now trading at very expensive price to earnings or price to sales numbers, particularly in the tech sector. I have several of these myself, but have resisted lightening up at least partially due to not wanting to realize big capital gains this year. Already have big 2020 capital gains from the BYD conversion at the start of this year, which was a taxable event, and I have held BYD for almost 10 years, so had a large embedded gain. I figure there are probably a lot of investors who are feeling the same way with some of their big winners, and I'm wondering about a run of tax GAIN selling in the first week of January, from people who want to lock in some gains, or lighten up outsized positions, delaying capital gains to 2021. Do you think this is a risk, particularly in some of the tech stocks that have doubled, tripled, or more in a very short period of time, and are there any stocks you think might be particularly vulnerable?
Read Answer Asked by Dan on December 22, 2020
Q: There have been a number of questions/comments concerning the recent 3 for 2 stock split of BEPC and BEP.UN and how fractional shares are handled. I reached out to TD Waterhouse and their response may be of interest to your members:

"When we received payment from a Split we as a Broker receive payment on our one bulk position. We do not get paid for each client individually. If the client had a physical certificate or held shares directly with the Transfer Agent in their name only than yes they would have rounded up but the company says for "Registered Holders". The shares in the clients account are registered "TD Waterhouse ITF the client" so when we get paid we get one payment for all our clients because all of our clients shares are registered the same way TD Waterhouse ITF. But the client will get some cash for the fractional shares. The CIL usually comes in about 10 bus days after the Re-Org was processed. "

I would assume the same would be true for all online brokers.

Hope this is helpful
Cheers
Scott
Read Answer Asked by Scott on December 21, 2020
Q: Morning Peter / Ryan and Team, first, Thanks so much for your calming advice through this past / current period of turmoil ! I am soon going to retire and start drawing on my rsp for income after years of accumulation. Thanks again to your guidance!!
This brings about some questions.
First, from a performance aspect, would a person be better using Drips and then selling stock to fund withdrawals, or, cancel drips and let dividends fund the withdrawals?
Second, when evaluating a stock/etf for an income portfolio, should more importance be put on dividend or growth? I have an all equity portfolio, diversified geographically and sector wise as per your recommendations, intend to stay in equity, simply increase cash reserves to fund withdrawals and allow a cushion. Thanks, Lavern
p.s. Happy Holidays to all, and Stay Safe! Better 6' apart than 6' under!!
Read Answer Asked by Lavern on December 21, 2020
Q: Hi Peter and team:
Just a note to say thank you. Two points: First, I sent in a question which I thought was almost an unfair one and virtually impossible. You actually answered it and provided your methodology with exactly what I needed. Second, I submitted my question late Friday, thinking I wouldn't receive an answer until Monday or so. I open up my email Saturday morning to find a reply time stamped at 2:00 am. Wow...needless to say, you made my day.
Thanks for the great service...above and beyond!
Please take Christmas Day off...Steve
Read Answer Asked by Stephen on December 21, 2020
Q: Good morning 5i.
Yesterday I asked a question about options and you replied that one of your favourite strategies is to sell a call and a put on the same stock. I suppose I could run a few examples to try to see how this works. But, perhaps the best is to ask you to expand on that strategy a bit. Any particular things you look at in this strategy?
Read Answer Asked by joseph on December 21, 2020
Q: My question is about investing in an index Exchange traded fund such as XEI, XRE, ZRE, etc.
How often do ETF (fund company) issue additional units/shares ?
Will additional issues of units dilute returns for medium to long term investors ? If yes how much of an impact would it have on returns and how significant would it be?
Read Answer Asked by Sridhar on December 21, 2020
Q: Getting cash in lieu of a full share of BEPC seems a bit cheeky to me. We were supposed to get a full share for any fraction.
I received $31.81 for half share. A full share is would have been worth $63.62. At the close on Friday that share was worth $66.98.
I didn’t see any mention of cash in lieu of fractional shares. So as of Fridays close I’m out $35.09.
Does anyone else think the same way I do?

Roy
Read Answer Asked by Roy on December 21, 2020
Q: I like picking stocks, but I am also looking for a way to automatically invest 10% of my monthly income into some sort of index fund. Do you know what’s the best option for this? Is there a way to achieve this without having to pay a $9.99 transaction fee each time I buy something (RBC direct investing)? Many thanks and happy holidays! Love your service!
Read Answer Asked by Hua on December 21, 2020