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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: what sectors could really be affected badly if interest rates go up significantly? thank you.

Read Answer Asked by jim on August 03, 2021

Q: It looks like around Seven AM this morning the Canadian dollar abruptly shot up a more than 1%, thus wiping out any gains I might make for the day. Any idea what the cause was? Any predictions about where the dollar-dollar ratio is headed in the near term? I hold a lot of US stocks in unhedged Canadian ETFs and am now reconsidering the helpfulness of hedged products.

Read Answer Asked by John on July 22, 2021

Q: I have a number of laggards in my portfolio that have been dramatically outperformed by peers during this year's rally, many of which I already own. I realize that you have generally rated these as 'hold' when asked in the past-yet I'm seeing a substantial opportunity cost to holding while others hold momentum during these hot markets for tech, industrial and commodities.
Any thoughts on whether it is worth continuing to hold and would you advise replacing at this time. ie on the balance of possible outcomes, would I be better off to stand pat or shift over to comparables within the sectors?

Read Answer Asked by Peter on July 19, 2021

Q: Precious metals having a good day today, assuming its mainly because of the hot inflation numbers coming out. Do you see these stocks having more room to run? I own the above. Can you rank the above stocks in terms of the inflationary environment and which have the best growth and potential. Which sectors would do the best? Also I'm low in energy, would that sector do well if inflation persists or is it mainly driven by energy prices? Do you still see inflation as transitory or more persistent? Thanks!

Read Answer Asked by Keith on July 14, 2021

Q: When financial aids due to pandemic shut down measures end do you expect market downdraft? In Canada the CERB will end on Sept 25, 2021. Not sure when the U.S. financial aids will end though.

Read Answer Asked by Linda on July 13, 2021

Q: The fixed income portion of our portfolio includes XBB@15% and ZIC at 6%. Portfolio analytics is suggesting fixed income assets @40%. I am not keen on adding more bonds and would be comfortable at 30% in FI. Can you suggest 1-2 alternatives for someone entering retirement?

Read Answer Asked by Rosemin on July 06, 2021

Q: Are we starting to see another sector rotation particularly back into tech? What do you see as the best sectors to put money to work in right now?


Read Answer Asked by Robert on June 21, 2021

Q: I realize that things are a little crazy throughout the world but can you see any particular reason that advisors of my friends ( 65 yrs plus ) are moving there portfolios into very defensive positions other than the good run in the last 14 months? Is there anything that I am not seeing as opposed to them? Thanks, James

Read Answer Asked by JAMES on June 21, 2021

Q: It seems all the Canadian banks are doing well - huge profits, reversing loan-losses, cash piles and talk of boosting dividends.

Is a lot of this profit due to the increasing real-estate mortgages being issued that have an implicit government backstop? I view this as a form of moral hazard - the banks know the government has their back so continue to lend despite worsening lending metrics like income to home price etc.

Do you see any risk from all the non-house owners in the country putting pressure on the government to reign in bank profits, as it seems only the 'rich' home owners are benefitting? Or would the banks themselves curtail lending as home prices continue to appreciate?

I know that the Canadian residential real estate market if a primary driver of our economic gains nowadays but at some point, the policital winds may shift.

What signals related to Canadian housing would you look for to make you want to reduce your exposure to Canadian banks?

Read Answer Asked by Neelesh on June 17, 2021

Q: Hi 5i team.

I'm going to try to re-phrase my question asked earlier re: levels in the S+P.

What is the S+P currently trading at and forward PE?
Since this is on the high side historically, what would be the reversion to the mean number? (I believe it's currently trading at 25xs and the mean would be 15?)
If at some point the market heads back there (as is typical in theory) what would the S+P be trading at vs where it is today?

Many thanks.

Read Answer Asked by Arthur on June 04, 2021

Q: Hi 5i team.

I am interested in your analysis of the following.

Given the markets appear to be trading at higher multiples vs "normal", can you please comment on what the current levels are, what the median levels would be (that history shows us) and what the market levels would look like if a reversion to the mean took place?

Many thanks.

Read Answer Asked by Arthur on June 02, 2021

Q: Hi folks.

With all this talk about higher inflation (new shiny object for the media) there has been very little discussion on the explosion of debt Countries have embarked on, pre, and since the onset of Covid. Seems like this appears to be a coordinated effort throughout the developed world, and as a result, no one seems too bothered, Including Conservatives.
Are there any lessons in history we can draw from? How does 5i think this all gets resolved over the next decade or two, assuming it will take a bit of time to generate enough growth to cover all this?
Are we headed for multiple Japans where the Gov't owns all or most Gov't issued bonds to control interest payments. Does this scenario create even more inflation with depreciation of currencies and a race to the bottom on exchange rates? Way above my pay grade so please take a stab at opining on this for us.

Many thanks.

Read Answer Asked by Arthur on June 02, 2021

Q: I am currently over-weight in Financials (more than 50%) in my portfolio. I am in the process of slowly re-balancing by first of all moving some $$ into Utilities & Telecommunications. What would be a reasonable % of portfolio for an average investor to have in Utilities & Telecommunications?

Read Answer Asked by Ronald on June 02, 2021