Q: Currently I have around 20 percent of my portfolio in US holdings. Given the nervousness of the Canadian markets re NAFTA etc., and the narrow range of Canadian sectors, would it be wise to increase the percentage of my US holdings? Secondly, should I keep the US shares in a sheltered or non-sheltered investment account? Thank you!
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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: With all the activity recently involving stocks that are shorted, it got me to wondering how and why the actual process works. I believe that the shorter borrows the stock with the promise to return the stock at a future date. The shorter is hoping that the stock falls in price so that the stock can be replaced at a lower price and the shorter pockets the difference.
My questions are: who does the shorter borrow the stock from? Is it from the brokerage who holds stocks in nominee name? I can't imagine an individual wanting to lend stock to someone who is going to do their best to drive that share price down. So if it is the brokerage, do they have the unilateral right to lend the stock or do they need my permission? Do all brokerages participate in this activity? Do I (as the actual owner of the stock) get any of the money the brokerage charges for this service? Why would I want to deal with a broker who is working against me in this regard? Finally, is there a time limit at which point the stock must be returned?
Thanks for the help in understanding.
Paul F.
My questions are: who does the shorter borrow the stock from? Is it from the brokerage who holds stocks in nominee name? I can't imagine an individual wanting to lend stock to someone who is going to do their best to drive that share price down. So if it is the brokerage, do they have the unilateral right to lend the stock or do they need my permission? Do all brokerages participate in this activity? Do I (as the actual owner of the stock) get any of the money the brokerage charges for this service? Why would I want to deal with a broker who is working against me in this regard? Finally, is there a time limit at which point the stock must be returned?
Thanks for the help in understanding.
Paul F.
Q: In regards to the comments of another subscriber's about HCG.
The investment thesis made perfect sense: management navigated well through 2008, the greatest financial crisis of the modern era. The company had good capitalization ratios, valuation, and track record. David Baskin, Barry Schwartz, Jason Donville, Martin Ferguson/Jeff Mo thought so, and they have great track records and returns.
Judging the outcome of one company outside of the context of the whole portfolio is not constructive. This company was also dropped from the portfolio before the crash even happened. At the end of the day, 5i has provided market beating returns EVERY year since inception with the BE portfolio. These sort of events happen in the market every now and then and we shouldn't be ignoring the gains on our big winners.
Also, should we criticize Buffet for investing in United Airlines? How was he supposed to predict the self inflicted PR nightmare that the company suddenly got themselves into. Educated estimates based on disclosed information is the best we have.
By the way, I'd rather swing for doubles and triples and average market beating returns than swing for singles with vanilla names to get the market return. No need for soul searching here.
Keep doing your thing.
Elliott
The investment thesis made perfect sense: management navigated well through 2008, the greatest financial crisis of the modern era. The company had good capitalization ratios, valuation, and track record. David Baskin, Barry Schwartz, Jason Donville, Martin Ferguson/Jeff Mo thought so, and they have great track records and returns.
Judging the outcome of one company outside of the context of the whole portfolio is not constructive. This company was also dropped from the portfolio before the crash even happened. At the end of the day, 5i has provided market beating returns EVERY year since inception with the BE portfolio. These sort of events happen in the market every now and then and we shouldn't be ignoring the gains on our big winners.
Also, should we criticize Buffet for investing in United Airlines? How was he supposed to predict the self inflicted PR nightmare that the company suddenly got themselves into. Educated estimates based on disclosed information is the best we have.
By the way, I'd rather swing for doubles and triples and average market beating returns than swing for singles with vanilla names to get the market return. No need for soul searching here.
Keep doing your thing.
Elliott
Q: I have made a lot of money by following 5i and avoided losing a heck of a lot more. No one is perfect or bats 100......
A lot of far bigger Advisory Co's got caught in this. I'm a member for life with 5i.
:)
A lot of far bigger Advisory Co's got caught in this. I'm a member for life with 5i.
:)
Q: Hello,
I just want to make sure I fully understand the dividend and tax differences amongst different companies. Could you please list where these different scenarios are best held (TFSA, RRSP, Non Registered), how much they are taxed, and any other important tax information (i.e. which dividends need to be reported, eligible dividends, other common scenarios etc.). This question obviously has many parts so dock as many questions as you see fit.
A) US company with US dividend trading on US exchange:
B) US company without dividend trading on US exchange:
C) Canadian company with US dividend on Canadian Exchange:
D) Canadian company with no dividend trading on US exchange:
Thanks in advance!
Alex
I just want to make sure I fully understand the dividend and tax differences amongst different companies. Could you please list where these different scenarios are best held (TFSA, RRSP, Non Registered), how much they are taxed, and any other important tax information (i.e. which dividends need to be reported, eligible dividends, other common scenarios etc.). This question obviously has many parts so dock as many questions as you see fit.
A) US company with US dividend trading on US exchange:
B) US company without dividend trading on US exchange:
C) Canadian company with US dividend on Canadian Exchange:
D) Canadian company with no dividend trading on US exchange:
Thanks in advance!
Alex
Q: Since CIBC is the most sensitive to eventual housing downturn, how secure would be my RRSP and TFSA accounts with CIBC Investor's Edge in case CIBC gets into trouble. Thank you for great service. Milan
Q: Hi 5i
I know each stock in ones portfolio should not exceed about 5% of one`s total portfolio . Does this also apply to Bond ETF`s as well as Regular ETF`s .? My guess is that bond ETF`s can be upwards of 10% per ETF but regular ETF`s should be closer to 5%. Am i correct in this thinking ?
Thanks
Bill C.
I know each stock in ones portfolio should not exceed about 5% of one`s total portfolio . Does this also apply to Bond ETF`s as well as Regular ETF`s .? My guess is that bond ETF`s can be upwards of 10% per ETF but regular ETF`s should be closer to 5%. Am i correct in this thinking ?
Thanks
Bill C.
Q: Hi5i,
If I hold GIC's in a TD webroker account.
$100,000.00 BMO
$100,000.00 RB
Am I insured on each GIC or $100,000.00 for total account.
Thanks Dave
If I hold GIC's in a TD webroker account.
$100,000.00 BMO
$100,000.00 RB
Am I insured on each GIC or $100,000.00 for total account.
Thanks Dave
Q: Great article: The Other Side - April 19, 2017 by Michael Batnick
http://theirrelevantinvestor.com/2017/04/19/the-other-side/
See/Insert graph:
http://theirrelevantinvestor.com/wp-content/uploads/2017/04/12.jpg
Excerpt:
...
If I were in the business of picking stocks, I would do two things: I would try to exclude the worst stocks rather than attempt to pick the best, and I would focus on value, which are really two sides of the same coin.
While the best performing stocks from year-to-year are all over the map, from deep value to high beta and everything in between, the worst performing stocks over time share similar characteristics. So maybe it’s not such a bad idea to be a closet indexer after all, except you should try to be in the closet that screens out stocks that are highly levered, have growing accruals, inventory build, or whatever metrics you prefer.
Investors are drawn to glamour stocks because the payoffs can be huge. But while they have great possibilities, they also have bad probabilities, as Patrick has shown. The best performing glamour stocks outperform by 112% on average, but the median result is underperformance of 11%. The best performing value stocks on the other hand, saw a 78% average excess return, while the median saw a 5% average excess return.
...
Comments? As usual, thank you for sound advise.
http://theirrelevantinvestor.com/2017/04/19/the-other-side/
See/Insert graph:
http://theirrelevantinvestor.com/wp-content/uploads/2017/04/12.jpg
Excerpt:
...
If I were in the business of picking stocks, I would do two things: I would try to exclude the worst stocks rather than attempt to pick the best, and I would focus on value, which are really two sides of the same coin.
While the best performing stocks from year-to-year are all over the map, from deep value to high beta and everything in between, the worst performing stocks over time share similar characteristics. So maybe it’s not such a bad idea to be a closet indexer after all, except you should try to be in the closet that screens out stocks that are highly levered, have growing accruals, inventory build, or whatever metrics you prefer.
Investors are drawn to glamour stocks because the payoffs can be huge. But while they have great possibilities, they also have bad probabilities, as Patrick has shown. The best performing glamour stocks outperform by 112% on average, but the median result is underperformance of 11%. The best performing value stocks on the other hand, saw a 78% average excess return, while the median saw a 5% average excess return.
...
Comments? As usual, thank you for sound advise.
Q: Dear 5i
I am two years away from retirement and currently switching over my portfolio to a self directed acct at Questrade .
I want to be fairly conservative in my portfolio and feel that a 30% Equity 70% Fixed income would be appropriate .
I will be using 5i for stock selection . I`m just uncertain if 70% Fixed income is too much or not considering possible interest rate hikes down the road . Are there other fixed income investments other than Bond ETF`s , GIC`s cash etc . Also with bond etf`s are both interest and yield paid or is it one or the other only ?
Thanks
Bill C.
I am two years away from retirement and currently switching over my portfolio to a self directed acct at Questrade .
I want to be fairly conservative in my portfolio and feel that a 30% Equity 70% Fixed income would be appropriate .
I will be using 5i for stock selection . I`m just uncertain if 70% Fixed income is too much or not considering possible interest rate hikes down the road . Are there other fixed income investments other than Bond ETF`s , GIC`s cash etc . Also with bond etf`s are both interest and yield paid or is it one or the other only ?
Thanks
Bill C.
Q: Hello,
In the real estate sector, I have a position of 7% in D.UN, and 2.5% in CUF.UN. Both positions are respectively held in my TFSA and RRSP. I would book a 15% profit over the past year if I were to sell. How important is it to be exposed directly to real estate?
What's your thought on selling to buy more growth oriented stocks since I am a young investor and don't really need the income. What would be your company suggestions? I am currently underweight in consumer defensive (3% ATD.B), industrials (3% SNC, 3% WJA) or/and could also add another position in technology (2%BB, 2%PHO, 5% OTEX, 6% KXS).
Thank you,
In the real estate sector, I have a position of 7% in D.UN, and 2.5% in CUF.UN. Both positions are respectively held in my TFSA and RRSP. I would book a 15% profit over the past year if I were to sell. How important is it to be exposed directly to real estate?
What's your thought on selling to buy more growth oriented stocks since I am a young investor and don't really need the income. What would be your company suggestions? I am currently underweight in consumer defensive (3% ATD.B), industrials (3% SNC, 3% WJA) or/and could also add another position in technology (2%BB, 2%PHO, 5% OTEX, 6% KXS).
Thank you,
Q: Hello,
I assume that VFV and ZSP are identical EFTs provided by Vanguard and BMO respectively. Their MER, asset allocations, sector breakdown are close to identical.
However I notice the following anomalies (VFV vs ZSP):
1) Dividends of $0.238 CAD vs $0.145 with yields of 1.565% and 1.789% respectively. Why the difference in dividends?
2) Portfolio turnover rate of 13.18% vs 31.90%. Why would there be a difference in turnover rate?
3) Benchmark: S&P 500 CAD vs S&P 500 TR CAD. What does the "TR" mean?
3) Market price (NAV?) of $56.33 vs $34.94: Is this due to dividend reinvestment and inception date?
If one were to buy one of these, which would you prefer and why?
Thank you for your excellent and unbiased opinion and service
I assume that VFV and ZSP are identical EFTs provided by Vanguard and BMO respectively. Their MER, asset allocations, sector breakdown are close to identical.
However I notice the following anomalies (VFV vs ZSP):
1) Dividends of $0.238 CAD vs $0.145 with yields of 1.565% and 1.789% respectively. Why the difference in dividends?
2) Portfolio turnover rate of 13.18% vs 31.90%. Why would there be a difference in turnover rate?
3) Benchmark: S&P 500 CAD vs S&P 500 TR CAD. What does the "TR" mean?
3) Market price (NAV?) of $56.33 vs $34.94: Is this due to dividend reinvestment and inception date?
If one were to buy one of these, which would you prefer and why?
Thank you for your excellent and unbiased opinion and service
Q: I suggest you place a eValium button on a stock every time it tanks. I could prevent folks from jumping off windows. On second thought marijuana ETF would do the same.
Q: totally agree with Jim your services surpass any other
your advice and analysis are more than appreciated
keep the super good work
thanks for your insight and knowledge
your advice and analysis are more than appreciated
keep the super good work
thanks for your insight and knowledge
Q: How can I find out what sector a stock is in?
Thank you
Thank you
Q: Hi,
I remain somewhat confused about which account it's best to hold Dividend paying stocks in. I've noticed some responses where you indicate it's best to hold the dividend payers in non registered accounts and higher growth stocks (capital gainers) in a registered TFSA or RRSP account.
For whatever reason, I assumed the opposite as I thought receiving dividends was more along the lines of receiving income (i.e.- cash) so it would be best to put these into your registered accounts to lower the tax bill.
So, in my situation, as I receive approx 60k in annual pension income- am I better to put the dividend payers into the registered or non registered accounts to keep the tax bill as low as possible.
Thank you.
I remain somewhat confused about which account it's best to hold Dividend paying stocks in. I've noticed some responses where you indicate it's best to hold the dividend payers in non registered accounts and higher growth stocks (capital gainers) in a registered TFSA or RRSP account.
For whatever reason, I assumed the opposite as I thought receiving dividends was more along the lines of receiving income (i.e.- cash) so it would be best to put these into your registered accounts to lower the tax bill.
So, in my situation, as I receive approx 60k in annual pension income- am I better to put the dividend payers into the registered or non registered accounts to keep the tax bill as low as possible.
Thank you.
Q: Can you explain Prem/Discount to NAV 0.48%, Actual Management Fee 0.65%, Actual Management Expense Ratio (MER) 0.70%.
Thank you
Thank you
Q: Hi, folks
I'm very new to 5i Research, and trying to get myself orientated around.
I have some questions on the balanced portfolio
1) with less capital like $50k, what your recommendations on how to follow this portfolio?
2) when there is a add/remove in the portfolio, how quickly I will be notified?
3) in the report, when you add or trim a position, do you provide at what price to buy or sell?
4) for how long I need to hold the stocks in your portfolio? Do I need to have a stop loss/trailing stop to max my gain and minimize my loss?
5) what is the average holding period for a stock in this portfolio roughly? You can give me a range the longest to the shortest...
6) to initiate to build this portfolio for my own, is it better to wait for the market to pull back? or Do you have a recommendation about when to buy?
By the way, is it ok for me to ask questions about stocks/ETF's outside Canada or large cap's inside/outside Canada (I know you guys are focus on mid to small caps)
Thanks a lot!
Jane
I'm very new to 5i Research, and trying to get myself orientated around.
I have some questions on the balanced portfolio
1) with less capital like $50k, what your recommendations on how to follow this portfolio?
2) when there is a add/remove in the portfolio, how quickly I will be notified?
3) in the report, when you add or trim a position, do you provide at what price to buy or sell?
4) for how long I need to hold the stocks in your portfolio? Do I need to have a stop loss/trailing stop to max my gain and minimize my loss?
5) what is the average holding period for a stock in this portfolio roughly? You can give me a range the longest to the shortest...
6) to initiate to build this portfolio for my own, is it better to wait for the market to pull back? or Do you have a recommendation about when to buy?
By the way, is it ok for me to ask questions about stocks/ETF's outside Canada or large cap's inside/outside Canada (I know you guys are focus on mid to small caps)
Thanks a lot!
Jane
Q: I am trying to understand how you do things and can only re-visit this topic when my time permits.
I understand there are 11 sectors:
1. Technology
2. Basic Materials
3. Industrials
4. Financials
5. Consumer Cyclicals
6. Consumer Non-cyclicals
7. Utilities
8. Telecommunications
9. Healthcare
10. Energy
11. Real Estate
Would you agree with above?
Keeping this in mind, you have a representative of each sector in the Balanced Portfolio?
Do you feel that a person should have all sectors represented in their portfolio at all times?
Thank you in advance for your help with this.
I understand there are 11 sectors:
1. Technology
2. Basic Materials
3. Industrials
4. Financials
5. Consumer Cyclicals
6. Consumer Non-cyclicals
7. Utilities
8. Telecommunications
9. Healthcare
10. Energy
11. Real Estate
Would you agree with above?
Keeping this in mind, you have a representative of each sector in the Balanced Portfolio?
Do you feel that a person should have all sectors represented in their portfolio at all times?
Thank you in advance for your help with this.
Q: I would just like to echo Rod L's response to "complaint re KWH.UN etc". I have been a very happy member since May of 2013. Not everything has gone well, but by roughly following a 5i model (I think diversification, self risk assessment, and time) I have much more than exceeded my investment expectations. I think anyone would be hard pressed to find a better investment service anywhere - and the price is a bargain!!