Investment Q&A

Q: Re: VUN
I am a longterm investor and have become overweight Canadian equities particularly versus US equities. My question relates to whether I should buy the US broad index now or wait for a more substantial pullback?

Q: Hello, I would like your opinion on a macro economic situation. The "govt" keeps expounding the line that there is virtually no inflation and the central bankers (fed etc) can keep printing more money because of this. However, in your answer about G you mentioned that the cost of production keeps going up for the miners. All of us "commoners" know that everything that we have to buy is going up in price or being disguised with smaller packages etc...so my question is this: how do these two opposing situations of talk vs reality play out? As a small retail investor I am very concerned about where we are headed and what is going to happen to ones savings?
Thanks for your insights.

Q: Hello, I hold an extensive blue chip portfolio aimed at the rising middle class in emerging markets (BRIC's). Portfolio includes KO, NSRGY, NKE, CMI, BUD, GE, HON, ETN IBM & VALE. With reporting season approaching & in light of BRIC slowdown, should I back down or stay the course? Any separate view on VALE (only resource stock)? Appreciate your help.

Q: Hi Peter & 5i: You mentioned the potential for the flooding in the western prairies area to impact drilling operations on effected lands. I'm wondering more broadly about whether you have any thoughts on other businesses that may be impacted significantly. Unfortunately located REIT properties come to mind on the negative side but there must be other examples. I don't know whether there are "clean-up" oriented businesses that might actually may do well as a result of the disaster. Can you expand my thinking here with suggestions of any stocks that bear extra-careful watching while the waters recede? Thanks!

Q: Hi Peter and Staff,

Love your service ! Have recommended it to my investment club.

Equities are down today. The "correction" is here - and may provide buying opportunities.

My question. I am a believer in seasonality and DRIP programs. One of the most significant recurring seasonal events is the best six months of the market to be in (Late October - Early May).

For a long term buy-and-hold strategy, would it not make sense to participate in automatic DRIP's during the worst 6 months (forced buying during seasonal dips), and leave the DRIP programs and bank the dividends during the best six months, and then use the accumulated cash to re-balance/purchase on good days (like today).

Thanks !

Q: The dividend stocks are getting hit hard including all the large cap blue chips. I think it's just a normal correction since they've had good run ups for a long time. Is the income dividend scenario over.

Q: Hello to all ...my question regards the Bernanke announcement of pull back on bond buying by the fed. Is this the precursor to stopping ALL QE in 2013 and then raising interest rates at some time in 2014? And are hyou people still confident interest rates will stay low till late 2014 ?

Q: my portfolio is 12% ADR 19




My portfolio is 12% ADR 19% US stocks 31% in the TSX and the rest fixed income.The ADR and US stocks are in US dollars. As my bonds mature, would it be more advantageous to put the cash in US dollars and invest in the US market considering the strength compared to the Canadian market?

Q: Hi Peter,
What do you make of the US Markets that go up and up even in the face of negative news and statistics? Is it time to get out?
Thanks for your advice!

Q: Peter ... are we going to experience a 10% market correction in the near future? ( 2 months). Thanks for everything.

Q: hi. where would you invest to have globale exposure. ETF OR other.

Q: Peter, I am considering selling a portion of my RY which has been reasonably strong ( I will keep enough RY that it will be 3% of my portfolio. I also have TD and BNS, each at the same 3% ). I would invest the proceeds evenly over a basket including UNS, SCL, BAU, FTT, ACD, BDT, BEK.b, NAL, LIQ, RBA, FRC.........looking for small and mid-cap value, with some of them paying a dividend. Would appreciate your opinion. Many thanks, Barry.

Q: hllo peter, just a general question.... I have quite a bit of cash to spend... should I wait until after the summer, as in general markets go down.... or should I spend it now on a down day.... what would you buy for dividends as part of a core holding, and is this the time to buy them?

Q: I'm concerned about the volatility of the TSX; up 144 yesterday, down 167 today at 11.15 pst. In this environment, how can anyone invest for the long term with any confidence? We have 600G in stocks, and another 10% in cash. I was thinking of adding to some positions, but would I be better keeping the cash in the bank? Or is it just 'sell in May and go away'? Until when?

Q: Thank you for your response to my proposed summer switch: That being said, there is a chance that the US market will continue to outperform Canada, so that would be the main consideration in this switch. Also, switching now and re-balancing in six months does sound a bit like timing the market and the Canadian-US differences, which generally is ill-advised.You will be shifting towards interest-rate sensitive names also."

My motivation has four components:
1) to cut back on my daily trading, for the summer;
2) a view that the US president is committed to hurting the fossil fuel business, without regard to economic cost;
3) my expectation that Congress and the President will remain at loggerheads up to the 2015 congressional elections, leaving a leaderless Western World and related poor recovery of Western economies, including Canada's - big time; and
4) my hope that there will be a major boom as Aapl, Goog, Mcsft in time for a yesr-end spurt in consumer spending on Technology toys.

Given this background, maybe I should forget about my re-balancing to Canadian names and just hunker down for a lac lustre year on the SP500? Any comments?

Q: I see that David Rosenberg is starting to see signs that inflation will start to come alive in the coming months. If we subscribe to this opinion, can you think of a few of your A and B rated stocks that would be worth accumulating to prepare for such an eventuality. Thanks; love your service.

Q: Dear 5IResearch,

Having experienced some unprofitable results for the past few summers, I am now going to re-balance my portfolio, away from its total reliance on US equities, to include some Canadian names and then to weld it shut until October.

Currently my portfolio is 42% Berkeley Hathaway (BRK.B), 15% Wall Street bank (GS), 15% High-end US housing (PHM & DHI), 7% US Railroad (CSX), 7% Technology (GOOG or MSFT, but not AAPL) and 8-10% Cdn hedged index on SP500 (XSP)

I propose to reduce investment in GS, CSX, Technology and SP500, in favour of some good Canadian names.

My short list for these is:

Northland Power (NPI),
Agrium (AGU) or Potash (POT),
Pembina Pipelined (PPL) or Inter pipeline (IPL.UN),
Gold bullion (CEF.A),
and a western Canadian Reit (to be selected)

In the Fall, I expect to go back to a broad perspective of the entire North American economy, at large, hoping that Obama stops stalling the pipeline, by then. The asset allocation will likely be adjusted, to cope with the October 2013 - A.pril 2014 period.

Can you please comment on my proposed purchases of Canadian stocks? Danger signs would be appreciated.

Have a good summer.

Q: Hi Peter, some stocks have weathered the current downturn well and have generally held their ground. I'm wondering if these are buy candidates because of their current strength. Perhaps they are just a safe haven for now, and could lose value when the correction is over and the money goes to the beat-up stocks. Some examples are MSI, GEI, FCR, TRI, BNP, MG etc. What do you think? Thanks Tim......

Q: How does one get a report on the following stocks:
BBD.B
ZRE
AQN
XHY
IFC
AIF

What should be the number of stocks held in each account eg.
RRSP, RESP, TFSA, Investment Account.

Thanks

JRM

Q: I am 80 and we need to booster our US Social Security to a livable income, but my wife, just 65, also needs growth to keep up with inflation. We are both Canadian/US citizens and US dividends can be hit by 20% as a result. In a rif, 2 tfsas and our joint portfolio, we have over $500G invested in about 30 Cdn stocks; 5 major banks, 4 pipelines, oil (HSE,CPG, BTE,CVE), REITS (rei,ax,cwt,d), power (aqn,bep,ema,fts) and tel (bce,t,mbt), plus some pot,tck,mg,enf,pwf, etc. I just sold a bond and now have about $140Gs to invest, so would like some advice. I'm intested in CSX in the US as I think we need to be in a railroad, but should I just add the rest of the money to our present stocks? I know this is a tough one but we need income and, at least, to keep up with inlation for my wife.
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