Investment Q&A

Q: How is the 5i Portfolio Tracking and Analysis will adjust for the split 2 for 1? Will one have to correct the amount manually?

Q: Portfolio Analytics categorizes Sienna Senior Living as Health Care and Northwest Healthcare Properties as Real Estate (I get that it's because it's a REIT). A couple of questions:
1) Does it make sense to consider NWH.UN as being in the Health Care sector?
2) In general, does it make sense to override the sector a stock is allocated in cases like this?
3) Have you thought of adding a column to your database to allow users to do this? Using an extra column rather than overriding the Sector provided by Portfolio Analytics would give the user access to both values.
4) Same questions for Geography (see my previous question).

Thanks
Peter

Q: Hello 5i
It is great that these changes have been made to the Portfolio Analytics. The next important change would be to be able to download my portfolio with the combined positions instead of the separate ones. Adjusting the downloaded spreadsheet to having to add all the similar elements is a chore to get a hard copy of everything. Since I buy and sell with TD and monitor using Morningstar and Yahoo it makes things difficult. (I use Morningstar and Yahoo in addition to your great Portfolio Analytics as each offers a different perspective) and, yes, I do spend hours a day reviewing my portfolio but only taking action at your suggestion, when required but its is good to be hands on as nobody else would care as much as I do because its mine and not a generic assimilation from a broker!
Question: Is combining the positions available to the download in the works?
Thanx
Stanley

Q: I have been investing in ETFs for several years, using a simple 5 ETF portfolio which includes VCN (27%), XUU (27%), XEF (19%), XEC(7%), and ZAB (20%). When I use the portfolio analytics, the suggested ETF portfolio includes about 15 ETFs. Just wondering what if the added complication of the additional funds is worth the effort. I assume that yours has better downside protection as it reduces some of the concentrated sectors and perhaps has better returns? My portfolio has grown in size over the past years so I am ok with the additional work to manage the portfolio, just wanted to better understand why.

Thanks,

Q: For those interested in Shopify and Amazon there is an excellent article in this mornings National Post.
Peter

Q: Hello, Sent a question earlier and your reply is as follows;

PA recommends to reduce my technology exposure which is at 38%. Only problem is I am unsure which tickers to get rid of, like them all.

In my RRSP; OTEX at 4% and XAW at 21% not a direct tech exposure but does hold plenty of tech, just not sure how much.

LIRA: SHOP at 6.5%( recently chopped it from 9% to 5%), LSPD 5%, KXS 3%, QST 2.2%,

TSFA: CUSat 5%

Which one would you pull the plug on?

Tks

Asked by Rino on August 22, 2019
5i Research Answer:

XAW is currently about 22% technology. We like all the names here, and there is nothing stopping you from selling some of each if you want to lower exposure. XAW at 21% is a large position and could also be moved to 15% or so in our view. It has not performed so well either. If you want to sell just one we would lean to QST as the smallest and riskiest.

I should have also mentioned that PA also suggest to reduce my canadian exposure which is above 60%. That is the reason why my XAW exposure is at 21%. Having said that if I were to sell roughly 6% of XAW, can you suggest another non canadian etf to invest in? Seeing that XAW covers basically everything for my international exposure.

Thanks again!

Q: The Analytics tool suggests I am significantly overweight geographically (Canada). The tool also suggests I downsize my financial holdings and increase Consumer Defensive, Tech, Healthcare, and Industrials. Which sectors would you tackle first to increase? Please provide 2 or 3 stocks/ETFs that you would recommend to begin re-balancing my portfolio geographically and by sector?

I am a long term investor and I have evolved over the years towards buying more of the larger cap companies.

Thank you!

Sean

Q: Peter; Please tell Paul that PA is instant and up to date the second you enter any changes it is reflected in the holdings . Rod

Q: What are the various sector weights to use at the moment?

Q: Your Analytics program has provided a convenient tool to see the weightings in my overall portfolio. From this I have learned that while there are some with larger percentages I have many positions between 1 - 2% weighting. Sometimes this resulted from my having initiated small purchases and sometimes from falling share values. In any event, I wonder if I am spread too thin? I guess one part of this is that the small positions will not move the dial. On the other hand, quite often your members ask what you might recommend when looking at choosing between 2 stocks and the answer suggests having both, for better diversification.
1. So my first question is whether positions of 1 - 2 % are too small or is this good diversification?
2. In this context, my next questions are about positions of 1.57% and 1.42% in Enghouse and Kinaxis; are these positions too small and if so, which would you sell and which to keep / add to? And similarly, positions of 1.39% and 1.18% in Parex and Suncor. If these positions are too small, which to sell and which to keep / add to?
3. In a similar vein, I have one or two positions that have suffered from considerable declines in share value and there is .36 and .56 of a position. What should I do if I do not want to sell, either because I still believe in the prospects or because it is too painful to sell just now. I often see your answers suggesting you do not believe in averaging down but holding such a small position seems not effective.
4. My last question is about Constellation Software. It is of course one of the better performers and partly as a result presently I have a weight of just under 3.5%. Given its success, would you recommend adding to have a larger position, and if so, how much?

Thanks for your excellent service.

Q: I signed up for yesterday's webinar but was unable to participate live. Where may I access the webinar now? I am enjoying Portfolio Analytics, and like the new updates to the service. Thank you, Jane N.

Q: Portfolio analytics vs Portfolio tracking and Analysis. What is the difference?

Q: In your portfolio analysis you have recommended for the utilities sector that I purchase either ZUT or XUT.
I own Fortis now.Do you recommend that I sell this now and purchase 100% ETFs for the suggested Utilities sector?
Since I also need additional US investments.which of the following US ETFs would you recommend RYU or XLU?
Thanks again for your guidance.

Q: I have recently been making significant adjustments to my portfolio, based on the results of Portfolio Analytics. In particular, I am significantly decreasing my financials and energy, and making large increases to my US and international weights.

Despite my changes, I am still overweight by 6% based on the recommended financials, and by 5% for energy. I am underweight international by about 6%. What is your recommended tolerance? How much leeway do you suggest for the recommended allocations?

Also, I am currently invested about 11% in VIGI. What is the maximum allocation you suggest for any ETF? I am a fan of the dividend aristocrats/growers strategy. Is there any other international dividend ETF which you would recommend (if possible, sold in Canadian dollars) along these lines?

For the US dividend growers, I have DGRO, VGG and ZDY.

Thank you for this incredible service that you offer!

Q: From your suggested ETF list you provided for my Portfolio Analytics which ones would be best to incorporate in my RRIF and TFSA? Hope you have access to those ETF's. Thanks.

Q: Hello 5i,
Like many here, I have , according to the portfolio analytics program, far too much in Canadian and far too little in the rest of the world. I am trying to remedy this but I am finding reducing Canadian holdings a bit difficult. I know that you like to see each holding equaling five percent. Although, I guess you qualify this when you say that you are testing the waters on some stocks, then you go at about two and half percent.

I am wondering whether one might consider very similar companies, such as BNS and TD or CP and Cn, almost as one stock? That is, rather than hold five percent in each as maximum, hold 2.5 percent in each as maximum, allowing the two to equal five percent? thanks

Q: When you reccommend an ETF portfolio as part of PA, is it dynamic or static? Will the allocations be the a year from now as they are today?

If they do change will they change automatically, eg with market movements, my age etc?

Thanks

Sheldon

Q: Thomson trades in both the US and Canada and, even if I hold TRI in the US, the Asset Allocator allocates it as Canadian.
TRI's average daily volume is higher in the US than Canada.
From a business point of view, TRI's sales in the US are greater than Canada.

When thinking about portfolio diversification, on a geographic basis, should TRI not be considered a US equity, whether held in the US or Can?

Could your online tool be adjusted to allow the user to manually make that change?

Thanks

Q: Hi Gang,
After doing my PA, it says I am short in US holdings and the following sectors; consumer defensive, consumer cyclical, health care and industrials.
Suggestions of your favorite US stocks within each would be great. I don't need the $ for more than 5 yrs, reasonable risk ok. Looking at my portfolio as a whole, I plan on holding these in my RRSP. does that make sense re US tax with holding?
thanks
Michele

Q: I noticed today a question asked about the asset allocation of goog and how this will be fixed. Thank you. Will this fix also apply to other such holdings such as Disney, currently classified as consumer cyclical, now communcation services? Thanks again