Investment Q&A

Q: Hi Peter, My question is about returns in the S&P during a four year Presidents term. On average what are the markets (ie S&P 500 ) return in year 1 vs year 2 vs year 3 vs year 4. I heard an analyst mention that the best returns come in year 3. Can you confirm the returns by year. I appreciate the great service.

Q: When lookking at the ROI over 3-5-10 years. The S&P has always done better than the others. When looking at the strength of their economy and the investment that US companies put in R&D how are they gonna loose their 1st position as a super economy power? and foremost and this is the question: Why invest elsewhere? Canada with merely 5% of the world economy? Europe has been lagging since I started investing 40 years ago where else? China? gotta be kidding. Seriously why spread our investments worldwide when the best is our neibours? Just buy the S&P and wait still forever.

Thanks

Yves

Q: hi, portfolio analytics says I am underweight basic materials, consumer defensive, healthcare and industrials. can you provide a few Canadian and US equities in each category, that you would consider for medium to long term investment.
cheers, chris ( take as many credits as you need ).
further, I am overweight in utilities ( 18.6% of total holdings ) and financials ( 25.5 %). do you recommend trimming these 2 sectors? and in financials I own BN and BAM ( which I would suspect actually have cross-over with other sectors? )??
cheers, chris

Q: US stock market almost recovered after a stunning run lately. The Canadian market is apparently still recovering. Do you think there is a rotation that will be going on, e.g. Canadian stock market, or non-AI stocks? I am wondering whether there are some Canadian stocks that may be benefit from the rotations that we can invest now?

Q: Dear 5i,
At a high level with respect to Canadian stocks.
Which sectors are the most sensitive to interest rate changes?
For the ones you identify can you please suggest how they might react
when rates go up or down?

Q: hi, any news accounting for the severe stock price decline today? further, what is your best guess as to where we are in the "recession" cycle now??

Q: How long do you think before AI starts changing things for companies? Where do you think we will see the first impact and what type of companies will be affected long range. I know this is a crystal ball question but your opinion of the future of AI and how we should prepare is highly valued.

Q: How do you feel about margin usage in the context of the current rate environment? Do you believe it still has a place for risk-tolerant investors, especially considering potential tax write-offs? Or do you think the potential risk/reward is simply not palatable at the moment? If the latter, what are some effective ways to reduce margin exposure without being forced to sell assets or unbalance a portfolio?

Q: Ray Dalio says US is at beginning of late Big-Cycle Debt crisis. What is your opinion on this and can you please explain what this would mean. Thank you!

Q: Not sure if this is within the scope of your service, but can you explain why a country like Japan with a huge amount of debt-to-GDP has not had a collapse of it's currency from YCC or huge inflation? How is it that increased debt has let to deflation? I've heard some reasons over the years but none that make sense.

The reason to ask is our Canadian, European and US governments also have a huge debt burden, increasing interest payments on this debt and a continuing increase in debt over the foreseeable future. How could any rational investor have confidence in this debt/credit based system? Will we turn Japanese? (to quote the Vapor's song!) What factors would push us into deflation vs inflation?

Q: Peter; This may be out of your purview but would the destruction of the Kherson dam in the Ukraine affect the grain crops and drive prices ? Thanks.
Rod

Q: Hello 5i,

What is your opinion on a potential liquidity headwind for stocks? Would you expect a broad short-term decline in stocks (e.g. S&P 500) or are specific sectors at a higher risk? Do you see opportunities to buy prior, during, or after the Fed begins to fill its reserves?

Thank you
D&J

Q: I note you were asked something similar to this last October, but that was with respect to gold. There is more talk of a desperate Putin using a tactical nuke in Ukraine as this is his only path to victory while failure means his own demise. I know you can only guess but my own guess is the overall markets would go insane, blow through circuit breakers and drop at least 10%-20% on the day. Is your more experienced, more considerate 'guess' somewhat similar?

Q: I just read Peter's blog entitled "5 Market Bubbles Including One That is Just Starting to Blow Up Now". In the Artificial Intelligence (AI) section, it says "Also remember that AI has the ability to destroy sectors and other companies, or at least lower their valuations. Investors need to be careful about what they buy in the AI field, but also about what they own elsewhere in case it is negatively impacted by AI."

Can you please elaborate on what sectors you think might be impacted (or destroyed) or have their valuations lowered. Are there any 5i model portfolio companies or some of 5i US favorite companies that fall into this category.

Thanks so much for the constant excellence advice!

Q: Everyone, what is your concerns with the large cap technology sector today and for the next six months. Clayton

Q: My understanding is that if an agreement isn't reached before early June (?) regarding raising the U.S. debt ceiling then there could be significant global economic fallout... leading to unemployment, interest raise hikes, and of course, large market selloffs.

How much weight/attention are you guys putting on this situation? Is this leading to a significant buying opportunity? Is it wise to increase cash position until this plays out?

Q: Should we be concerned about the States debt ceiling? If we look back to 2011 the markets took a massive hit and according to JPMorgan’s top strategist Marko Kolanovic now is a good time to add to gold and hold on to cash. Your thoughts please?

Q: Hi Peter,

Hopefully it won't time out (if that's the problem)....I saved the question and I just did a copy and paste.

Hi Peter,
I asked if you got my question sent on May 11 and 5i responded saying you didn't get it an to re-send it....here it is:

Regarding Timour's question on CBDC's posted the 11th May, I get the impression the response seems "positive" on CBDC's. I was a bit surprised that their was no mention of how this would affect each and everyone of us with the retail CBDC's. The idea is to get rid of cash completely, which would give central banks absolute control of the money of each individual, not me saying that, here's a 57 sec. video from the top guy of the BIS (a must watch):

https://www.youtube.com/watch?v=a9IimgEyjy4&ab_channel=ForbesBreakingNews

If an individual can ONLY open an account at the central bank of his/her country, then we would be at the mercy of the rules and regulations of that central bank and no other bank to go to because there won't be any. Wouldn't that be a complete monopoly? This is a very serious matter that everyone should know about....nothing like this has ever been done.

Please check these links....they are opinions of very knowledgeable people:

https://www.cato.org/study/risks-of-cbdcs

https://off-guardian.org/2023/03/07/central-bank-digital-currency-is-the-endgame-part-1/

https://childrenshealthdefense.org/defender/central-bank-digital-currencies-what-they-are/

https://www.forbes.com/sites/norbertmichel/2023/03/06/cbdcs-not-just-a-different-form-of-money/?sh=241c275a21b6

In this link please listen to at least the 2nd. 2:50 min. video:

https://home.solari.com/blast-from-the-past-week-of-april-17-2023-prof-richard-werner-the-case-for-abundance/

https://childrenshealthdefense.org/defender/central-bank-digital-currencies-cbdcs-cola/

I know there's a lot of links, but please have a look at them....no rush :)

Would really appreciate your comments,

Thank you!

Q: What will it take to make emerging ,markets be a top performer? Thanks Ron

Q: Do you anticipate recession in 2023 - 2024 and what impact it would have on stock market in general?
Thank you
Miroslaw