Investment Q&A

Q: hi folks:

regarding carole's question of should she dump a fund (cig786) and buy a stock

believe me when I say that I am no big fan of mutual funds, yet if you look at that particular fund, internationally balanced, with a below average mer of 1.6%, and one that has crushed the index over most periods, I wonder if your dislike of all funds has over taken prudence

with this size account, with the goals noted, I am very surprised you would not at least acknowledge the quality here

along with the international diversification carole alsohas had....

10.4% p.a. return over the past 15 years (fifteen years)

inception was dec 1996 and since then has an 9.78% annual return

(all net of fees)

I think your service is second to none, yet in this case I believe you are offside

(no, I do not work for CI funds, and my total fund holdings are 15% of assets, mostly international)

Robert

ps. this fund has out-performed many (arguably most) hedge funds which you recommend and they all have far far greater fees

robert

Q: Further to my question of March10/14, my wife owns Mawer Global Small Cap fund in her TFSA. She was advised by the company that no T3 tax slips would be issued for this fund, as mutual fund investments that are registered(RRSP & TFSA) do not receive T3 tax slips. If this is correct, does this mean that if she decides to invest in individual stocks of global companies in her TFSA instead of using the mutual fund, she will not receive a T3 tax slip either?

Q: I'm looking for your thoughts. My wife and I's RRSP money is invested in 2 mutual funds - Phillips Hagar and North Dividend Income fund (200K+ in D series, have held for 15yrs+ and no longer contribute) and Franklin Tempelton Bissett Canadian Equity (400K+ in F series, have held for 15+yrs and continue to contribute). At what point should I/we consider switching these to self controlled RRSP accounts as opposed to investing in Mutual funds - please note both are invested directly with the investment firms and not through a Broker? Both funds have what I consider low MERs at 1.18%, and have performed quite well as far a returns relative to overall markets with very little thought or effort on my part, allowing me to focus on other investment themes. Over the last few years I have taken control of much of our other financial assets and have self directed TFSAs (2x 40K) and non-registered monies in stock (100K), none of which overlaps companies invested in the mutuals, and most of which are a combination of profiled companies from your site... I'm not sure my question is a question, but I'm looking for your thoughts on evaluating switching from the quality of my mutual funds to say ETFs or a basket of stocks to replace the mutuals, if I was to do so. - Cheers.

Q: What are the tax implications of holding investments in a Global Equity Mutual Fund or ETF in my TFSA? As these funds hold many different stocks in different countries, how are the taxes calculated on the dividends or capital gains?

Q: Do you like the Cambridge Pure Canadian Equity Fund (Class A units) for a holding in a TFSA
account.

Q: What is your opinion on the Invesco Intactive Balanced Growth Portfolio in a RIF portfolio?

Q: Do you like the Mackenzie US Mid Cap Growth class? This was formerly Mackenzie Universal
American Growth Class?
Thanks.

Q: What do think of the Trimark Global Dividend Class for a TFSA holding?

Q: Hi all,

Just a comment, as per your answer to Jacques question, I believe you quoted the MER for the FT Bissett Microcap A series. As the Q's was about the F series (TML 239)the MER for the F series is 2.40%. Still high, but I have held this one for just over 16 yrs and considering selling because of the fees. No discount for larger accts. plus they were initially going after < 100 mill MKT cap companies but that changed after Templeton took over and opened a A series.

Q: Can I have your opinion on the Franklin Bissett Microcap Fund series F. I realize that the fees are quite high but the long term returns have been quite good. Wandering if I could use this fund as a percentage of my TFSA portfolio.

Q: Are there disadvantages in holding a Mutual Fund in a non registered account? Thank You.

Q: hello 5i team: i am trying to decide between active verses passive for global equity in my rrsp. this would be 15% of portfolio. comparing xwd for etf and mawer global equity also for small cap. 5% weighting of xsu or xcs to mawer global small cap. your input is greatly appreciated. thanks Larry

Q: Currently approximately 16% of my stock portfolio is in international stocks with the largest percentage being large banks (Santander, ING, JP Morgan, HSBC and Bank of America) at 28%. The remainder typically are large American and European companies (pharma, agriculture, metals, tech, industrials and telecommunications) . I recently sold some MacKenzie mutual funds. I am planning to take the proceeds and purchase Mawer Global Small Cap Mutual (MAW150) thinking that this will increase my international exposure to approximately 20% plus balance the weighting a bit more to smaller companies. I would appreciate your comments about my thinking and would like any advice for alternates. I very much value your thoughts. Thank you very much.

Q: ..oops I forgot to add I also own BMO Dividend Fund (146)-GGF70146 thanks

Q: This is to follow-up on the question posed by Linda on Jan 9/14 re. tax issues/negative factors to be considered with holding US (or other foreign)dividend paying stocks in a TFSA. Your response was that, yes, in a TFSA witholding tax will be applied on foreign dividends: in an RRSP it will not.
I'm not sure how much weight to give this info when structuring your TFSA. Should it just be -No- TFSA is not the optimal place to hold foreign equity - get your foreign exposure elsewhere. Or - Yes - this is something you should be aware of - it will act as a bit of a drag on returns - but should be subordinate to the over-all objective of your TFSA.
Specifically, I would like to re-structue my TFSA to replicate a mini stand-alone portfolio. And to do so I was considering the Mawer Balanced Fund as a simple one step solution - 40% FI; 20% Can. equity: 40% foreign equity - MER below 1% and consistently outperforms its benchmark.
Question: should the negative tax implications on the 40% foreign component be cause enough not to follow this approach?
Thank-you

Q: I know you have been asked this before but I couldn't find the answer.I have Sentry Canadian Income Fund NCE 717.The MER is high but the return has been pretty good.My holding is around 30K.Option 1 is to keep it.Option 2 sell it and put 50% into XIU and 25% each into CDZ and XEI.Any thoughts.Thanks for the great service.

Q: Hi Peter I know that you are not big on mutual funds in general. However, I've been looking at investing in the health care sector and came across CI's Global Health Sciences Corp Cl.
It shows 20% return average over 5 years with the past 2 years at 44 and 59%. Management fees are high at 5%. When the company publishes these figures, have the management fees already been taken off, or should they be subtracted to get actual returns. Would you also please comment on whether this fund is worth considering investing in. Thank you. Your information is always very helpful.

Q: Some think that 2014 will be the year for the Cdn stk mkt to shine. If you agree, what sectors would be best and what mutual fund(s) would best cover these? (I have mainly stocks in my accounts that are similar to you model, but am trying to get back to a few good mfs as well.) Thanks for you help. Alan

Q: Hi Peter,
I know you are not a big advocate of funds at this point in your career becasue of fees etc..However, what would your favourite funds be for US large Cap & US small cap? or perhaps you could recommend US large cap & US Small cap ETF?
Thanks

Q: I believe you mentioned Norrep Funds a few months ago, but
I can't find it in the archive. Would you please restate your
opinion of this family of funds? They seem to be very small,
and am concerned they can achieve the economies of scale to survive over the long term.