Investment Q&A

Q: Do you have a hard and fast rule for taking profits into a spike? So many stocks peaked in November and "round-tripped", many giving back their pandemic moves. I have heard -triple-sell-half, rebalance above 7%, etc. I find that they are easier said than done. Just need to add another methodology to my quiver as I have seen too many gains melt away.

Q: Regarding the currency in which dividends from BAM Brookfield Asset Mgmt are paid:

I see you recently stated they pay in USD.

However on their website it says
“ Registered shareholders who are Canadian residents receive their dividends in the Cdn dollar equivalent, unless they request to receive dividends in U.S. dollars.”

So it does not seem to be based on the currency in which you buy the shares. Can you confirm?

I am waiting for my discount broker to confirm that I can receive them in USD.

Q: Hi 5i,

For all of the companies you cover here, when you rate stocks, what is the most important factor you consider first? Do you actually meet with the senior management face to face on regular basis, or occasionally, or never? In any case, how you rate their management teams?
Thank you very much!

Q: Good day team. I own LSPD and follow KXS. As both are good companies I am thinking that one day I will either add to LSPD or open a position in KXS. The difficult part is comparing the value of these companies when they have negative earnings. Analysts often comment on the multiple of price to sales but this does not show up on a stock quotes. 1) is there an available source that provides this information, or 2) if I have to calculate it myself is the formula: stock price X shares outstanding divided by revenue?

Q: My question is regarding the posted returns of ETFs and Mutual Funds. I thought I read, years ago, that MF returns included the dividends for anything over 1 year...for example, for 3 and 5 year returns. For the posted 1 year return or less, they were without the dividend.

In my RBC Direct Investing, it is quite clear....it states the "unrealized capital gain". So I take that number, divide by the time I've owned the security...then add the annual dividend to get the Total Return/Year.

So, can you please clarify whether the standard practice is to include or exclude the dividends in the posted annual returns?

Thanks....Steve

Q: Shares of AMZN and some other high priced shares are available at very much lower denomination on the TSX. Do these have a significant hidden cost that would give the clear preference to buying AMZN on the US exchange? Thank you for your answer. Cheers

Q: In my RRSP account, I have SBRCY and LUKOY, which are NYSE-traded ADRs for Russian Sberbank and Lukoil. If the ADRs get delisted from NYSE, will I continue holding shares in these two companies and be eligible for dividends? If the answer is yes, will I still be receiving the dividends through my discount broker (BMO Investorline) or by some other means? TIA!

Q: You stated CDR's would be considered as foreign content. Then if you owned over $100,000 in an American company listed through CIBC you would have to fill out a T1135 even though it is bought through a Canadian exchange? This was why I liked them so I could increase my foreign content without having to do the T1135.

Q: Good Morning 5i and Happy New Year,
You answered a question earlier this morning and I am not totally clear on the answer. You mentionned that at a certain point in one's portfolio it would be wise to diversify into real estate, commodities etc.

I was confused because normally a portfolio would contain a certain percentage of commodities , reits, etc. That makes me think you are referring to something else. if so, what is it you would be referring to? Here is the post from earlier:
Above $4 or $5M, or even before, we would also consider alternative investments, such as real estate, hedge funds, or non-correlated assets (commodities, etc). We would not necessarily include these in the count of securities, assuming they are indeed not closely correlated to the rest of the portfolio. '
thanks

Q: I would like to purchase shares of WSP:CA on the US side of my RBC account via the ticker sign WSPOF (OTC Pink). I wish to purchase in US dollars to save on FX fees.

What is the impact on my proposed investment? Are their any downsides or is it essentially the same investment with a USD currency risk?

Q: What are your thoughts on investing in the CIBC CDR versions like GOOG.NE versus buying GOOG on the US stock exchange? The lower price makes it possible to buy a board lot but it does leave me in a currency hedged product. Thanks for the advice.

Q: This question may be a little premature however with on line discount brokerages such as CIBC Investors Edge about to charge fees to buy and sell Mutual funds where can I find a place to park short term cash?
I have been using Investors Edge high interest accounts which pay very little however are easy to use. Being a Mutual Fund this will incur fees in the future?
As I have twelve (12) different investment accounts this can become a little pricey for no upside other than minimal interest.
I am now looking for another home for short term cash . Ideas would be greatly appreciated.
Thanks

Q: Hi 5i a question relating to a members comment, Scott Jan 12, regarding the transfer of US listed ENB to the CDN side. I occasionally use Norbert's Gambit with DLR and had not thought of using a dual listings. Is there any reason the transaction with ENB differs from DLR to transfer currency?

Q: Good morning,

I just sold a US stock in my Non Registered US$ account that was paying dividends in US $ and was subject to a withholding tax.

I'm now considering the purchase of ENB for a solid and good dividend and would appreciate your thoughts on the following:

Q1. Is there any advantage of purchasing ENB in my Can$ Non Registered account over purchasing ENB in my US$ Non Registered account.

Q2. If I buy ENB in my US$ Non Registered account, on the US stock exchange, would ENB:US dividends be taxed as income and subject to a withholding tax?

I thank you and look forward to hearing your sage advice.

Q: Is the Buffett Indicator of any value today. Meaning if it goes above 180% should you rethink your momentum stocks and reduce margin? Buffett indicates that above 200% is dangerous and 120% is now normal. Have these numbers been adjusted in recent years due to quantitative easing and now that the feds have reduced quantitative easing should they be tightened? What do you feel the new normal range is with the feds hawkish change? I know timing the market is never good, but I think reducing margin and removing the gasoline at times should be considered.

Q: I use covered calls on a small number of US stocks to generate monthly cash flow and I am wondering what you recommend when coming up to an earnings report. Typically I use short duration calls of 1 month.

Is it better to wait for the report or ignore that and write a one month call that would straddle the earnings report? The other possibility, of course, would be to write a very short option to expire just before the earnings report.

I am looking at LMT at the moment but this is more of a "What factors would you consider in deciding in this kind of situation?"

Many thanks

Mike

Q: How do we as investors gauge "capitulation" in the markets. Would you say we are getting close in certain sectors i.e. technology. Thanks for your insight.

Q: Retired, dividend-income investor, with a reasonably diversified portfolio. I remember a question a while back (months, maybe even > a year?) about asset allocation, but I can't find it even after a lengthy search.

It had to do with how many stocks-ETFs, MFs one needed for a reasonably diversified portfolio, but in the context of the size of the portfolio as it grew over time.

For example, I hold 2 legacy dividend-income MFs (10% of portfolio), 7 ETFs (40%), 15 stocks (50%), ignoring the fixed income portion of my portfolio => a total of 24 equity positions. I am a firm believer in a concentrated portfolio and vary my allocation to meet my targeted allocations both by sector and security (allowing for my definition of comfort level or risk).

Your answer to the earlier question was that as one's portfolio grew over time, one might consider increasing the number of equity positions. I can't remember where the rough breakpoints were that one should consider adding additional positions.

Q#1 = acknowledging that you can't provide personal guidance, would the current asset allocation be suitable for a total portfolio of approximately $1-2 million?

Q#2 = roughly where should a person consider increasing their # positions? $3 million....$4MM?

Thanks for your help...much appreciated...Steve

Q: If you would like to do a short term trade with a long position are calls a better option than purchasing the stock?

Q: So I read in the G&M that household savings are at record numbers ; some $ 300 billion , twice the average of the last 2 years , yet I understand that Canadians are in debt to an unprecedented degree. How can this be ? The savers and debtors must be not the same person. Personally, I believe the boomers will come to the rescue of the many indebted GenX and Millennials by passing their sizeable assets over upon their last gasp.
Any thoughts ?

Derek ( boomer)