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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: I currently have, in ETFs, 20% in U.S. (VTI) and 10% in international (5% in VEF and 5% in VEE). I'm thinking that long term my U.S. and Int'l should be equal weight as one never knows what countries will perform the best. What are your thoughts on this and recommendations? Thank you.
Read Answer Asked by Pamela on June 13, 2017
Q: There is growing concern by well-respected economists and investment analysts about what appears to be out-of-control government debt - especially in the Western World. Like the 2008-09 mortgage crisis, a time when "nobody saw it coming" (fortunately the online investment program I listen to weekly had me prepared 18 months ahead) most people have their collective heads in the sand once again.

I have no idea what the end game is, but while I was prepared for what was eventually to become known as the Great Recession, I don't know how to prepare myself this time.

I am 70% in dividend growth stocks, 30% cash. I don't plan to sell any stocks but am not putting anymore money in the market at this time. Recessions historically occur about every 8-10 years, and this bull is arguably getting extended.

I've added some gold bullion and a bit of CEF.

I believe you had mentioned, if I'm not mistaken, about keeping under $100K at any given institution to avoid any potential future bank "bail-ins".

What other ways can one diversify?

I realize there are enough "chicken littles" out there that we have to listen to, and am aware of the potential missed opportunities of timing the market. I just want to make sure I protect enough of my assets, as I am only 20 months away from retirement. This kind of prudence has served me well in the past just ahead of the 2000-2001 Tech Wreck and the mentioned housing crisis.

Thanks.
Read Answer Asked by James on May 26, 2017
Q: Over the last few years, I've become familiar with the likes of David Stockman, Marc Faber, Jim Rickards, Peter Schiff, Jim Rogers, and other well-known perma-bears. They spend a lot of time warning about sky high stock valuations, extreme asset inflation generally, the banning of cash, the importance of precious metals, impending market crashes, runs on banks, the freezing of stock exchanges, and other light fare. I try to balance their dire outlook with more sanguine perspectives, but I'm always wondering if some of the extreme scenarios they envision will ever materialize.

For instance, Marc Faber appeared on BNN a few days ago, warning that the share prices of some of the most successful companies are headed to zero in the coming years. He didn't specify which ones.

Are you familiar with any of these pundits, and should any of their warnings be taken seriously? Thanks for your thoughts. I'm due back at the bunker now...
Read Answer Asked by Brian on May 16, 2017
Q: Hello team, I am fully invested (stock/etf's leaning toward growth) but am getting somewhat concerned about where the market is at. It seems (in my layman's eyes) that valuations across the board are getting stretched relative to fundamentals. I can take some profit and am wondering about some "insurance" in sectors such as gold; either cdn stock or etf's. For context, this is a registered account, 5 to 7 year horizon, mid 3 figures. Any suggestions
Read Answer Asked by Harry on May 08, 2017
Q: Good afternoon 5i. I am currently sitting with 25% cash on the side lines. I know that's much too high. I have avoided gold/silver sector as well as oil sector(I do have enb, trp, fts)I've also avoided consumer goods sector. I'm light in industrials (dow & cbi) and property sectors (tcn). All other sectors are represented fully and equally ie health/financials/tech. I have a 65/35% split between US/CDN market respectively. With the stock market correction today and yesterday would it be a good buying opportunity and what sectors should I focus on going forward and if you can offer some stock suggestions in each sector. Much appreciated.

Robert

Read Answer Asked by Robert on May 05, 2017
Q: The recent decline in CAD/US exchange rates has me somewhat concerned for my US investments. If you believe,as I do, that the CAD has reached its low point and may move up slowly from here, should you buy US shares in CAD funds? Or is it best to convert now and hold these in US dollars? In general do you believe it is best to have a mix of US shares in an even split of US and CAD currency? What should the factors be to determine how this is handled individually? Or does it even matter?
Read Answer Asked by Barry on May 02, 2017
Q: Could you recommend an ETF that trades in Canada with Canadian funds that.
A. Invests in US savings accounts and pays some interest
B. Is unhedged
Would this be an effective way to play a possible drop in the Canadian dollar. Is there another way that this could be achieved without the cost of converting dollars?
Read Answer Asked by William on April 26, 2017
Q: Dear 5i
I am 62 and plan on retiring in 2 years . I am open to positioning myself for 2 more years of some growth but preservation of capital is also important .
I have about 1M in RRSP`s and and close to shifting this amt to my brokerage co. to invest .
I`m thinking the following
1-$300,000 into Income portfolio including 10 good stocks from the Balanced Equity.
2-$300,000 into two different Bond ETF`s (fixed income )
3-$400,000 into 4 different ETF`s.
Does this setup look good to you and if so what ETF`s might you recommend given the current economic climate and my age ?
I don`t need income from the investments currently but think its important to have good dividend growth along with some capital gains .
I`m like most and prefer not to pay high MER`s as well.
Please deduct more than one question for this .
Thanks and looking forward to your response .
Bill C.
Read Answer Asked by Bill on April 17, 2017
Q: I don't usually like market timing and don't really believe in this "sell in may..." stuff, but this year is a little different. What are your thoughts if the Trump administration is unable to come up with a concrete tax reform plan by may/june? Would they have time given congress goes into break shortly after? I would expect there would be volatility ahead, but have you experienced similar events like this in the past where there's been bets on policy changes that don't materialize?

Read Answer Asked by dan on April 13, 2017
Q: Hi 5i, As one who remembers double digit interest rates, I've been wondering if and when the worm will turn again. It sounds like expectations are becoming pretty entrenched for higher rates in the US, and if that turns out to be true would expect Canada to follow with a year or two lag. Is there a typical pattern or approach that suggests which sectors and investment types benefit in a rising rate environment?

Thx for your excellent service!
Read Answer Asked by Rick on April 09, 2017
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