Q: On a business new channel I heard a comment about Utilities NOT being as "safe" an investment as we are generally lead to believe. I didn't quite catch if "safe" was referring to the stock price or the under laying business. You would think the safety of the under laying business would be based on expansion and price they can charge for their product. In terms of the proverbial "Utilities are safe defensive plays" would the stock brokers be referring to share price or the business model?
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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: Hi 5I
In 2008 i held my portfolio all through financial crisis even though it was very unsettling.I feel i made a huge mistake by not raising cash! There where unbelievable bargains of the canadian banks as one example with huge dividends available.Fast forward,now 64 years of age i have raised cash because i feel that a similar opportunity may exist. Maybe not to the extent of 2008,but it is with the strategy of picking up blue chip companies with enhanced yields for my retirement.
I have kept some good paying dividend stocks,preferred shares,debentures.
I am willing at this time in my life to forego some capital gain,to hopefully attain higher yields.
I concede that this is timing the market,but it is a strategy that i feel will help me in retirement.
Your thoughts?
In 2008 i held my portfolio all through financial crisis even though it was very unsettling.I feel i made a huge mistake by not raising cash! There where unbelievable bargains of the canadian banks as one example with huge dividends available.Fast forward,now 64 years of age i have raised cash because i feel that a similar opportunity may exist. Maybe not to the extent of 2008,but it is with the strategy of picking up blue chip companies with enhanced yields for my retirement.
I have kept some good paying dividend stocks,preferred shares,debentures.
I am willing at this time in my life to forego some capital gain,to hopefully attain higher yields.
I concede that this is timing the market,but it is a strategy that i feel will help me in retirement.
Your thoughts?
Q: Just a comment about the site www.dividendhistory.org, members should probably be reminded that any 3rd party source providing information about a particular company should be taken with a a grain of salt and verified against other sources (such as the company's website itself). For instance I noticed that the referenced site showed a whopping dividend decrease for Savaria in 2017 and knew that wasn't right so when I checked further I note that although they supposedly adjust for splits, their system apparently didn't handled the switch to monthly versus quarterly dividends very well!
Q: Dividendhistory.org provides a long term history. For example, the history for AW.un goes back to 2005.
Q: Hi Peter, Ryan and Team,
Since I do not have access to a computer or smart phone at work, I do all my buy or sell transactions in the evening from home after the market has closed through TD Direct Investment.
So on Thursday Jan 25, 2018 I decided to buy Intuitive Surgical Inc. symbol ISRG in the U.S. because of its recent momentum. The closing price was 449.81 and the high price for the day was 452.00. Since I was dipping my feet in with a very small position of only 2 shares I placed my order with a limit price of $454.57 i.e. $2.57 per share higher than the high price of the day. I have found that this eliminates missing out if the stock opens higher the next day.
The next morning i.e Friday Jan 26, 2018 on my first break at work approximately 10 am I saw that I had a missed call at 8. 20 AM from TD but there was no voice mail message. So I called them and a TD agent told me that my order for 2 shares was cancelled by TD before the market opened because “ my limit price was too aggressive since ISRG was going to open lower at 437.37 ”
My understanding was that in such a situation my limit order would have changed to a market order at market open at 9.30 AM and should have been filled at the lower price. Because there is no way for most investors to predict that a stock is going to open much lower the next day.
The TD agent was unable to tell me what the threshold is to constitute “a too aggressive bid price”. Since I still wanted to buy the shares he manually put in the order for me and charged me $43.00 for the trade instead of my regular online rate of $9.99.
I would appreciate if you would advise me the reasons for and the ways to avoid such a situation in future without calling in to TD each time I place a buy order. Thank you in advance.
Frank
Since I do not have access to a computer or smart phone at work, I do all my buy or sell transactions in the evening from home after the market has closed through TD Direct Investment.
So on Thursday Jan 25, 2018 I decided to buy Intuitive Surgical Inc. symbol ISRG in the U.S. because of its recent momentum. The closing price was 449.81 and the high price for the day was 452.00. Since I was dipping my feet in with a very small position of only 2 shares I placed my order with a limit price of $454.57 i.e. $2.57 per share higher than the high price of the day. I have found that this eliminates missing out if the stock opens higher the next day.
The next morning i.e Friday Jan 26, 2018 on my first break at work approximately 10 am I saw that I had a missed call at 8. 20 AM from TD but there was no voice mail message. So I called them and a TD agent told me that my order for 2 shares was cancelled by TD before the market opened because “ my limit price was too aggressive since ISRG was going to open lower at 437.37 ”
My understanding was that in such a situation my limit order would have changed to a market order at market open at 9.30 AM and should have been filled at the lower price. Because there is no way for most investors to predict that a stock is going to open much lower the next day.
The TD agent was unable to tell me what the threshold is to constitute “a too aggressive bid price”. Since I still wanted to buy the shares he manually put in the order for me and charged me $43.00 for the trade instead of my regular online rate of $9.99.
I would appreciate if you would advise me the reasons for and the ways to avoid such a situation in future without calling in to TD each time I place a buy order. Thank you in advance.
Frank
Q: Hi 5i: In the industrial sector of my portfolio I hold CAE, NFI, SIS, WSP, AMAT(US). I want to reduce the total number of stocks in each sector to two. I want also to make my portfolio as robust as possible to a NAFTA failure and/or a market crash. Could you please rank the above accordingly. I realize this is a tough question - thanks for trying!
Q: You replied to Michael today: "trim the areas that have done really well and add to the laggards". I can perhaps understand trimming back a position that one has done well but what is the logic of adding to laggards? Isn't this advice really suggesting you pull out the good stuff and add more weeds?
Q: Hi there, thanks for the January update. Reading between the lines and with the current strength in the market so far this month, would you suggest holding a larger cash position at this time? I am currently almost 100% invested at the moment. What would be an appropriate amount for a cash position in the current market climate? Thanks!
Q: If I place a stop on a stock, can that be seen by others on trading platforms anywhere ?
Q: Hello 5i team,
Your January update (like everything else that you do) was much appreciated.
Over the past decade, whereas I would have been satisfied with a 7% compound annual return in order to meet my income needs, my RRIF portfolio registered a growth rate of 15% compound p.a. That’s great! However, in the last 3 years while I kept expecting a lower return, the actual returns kept confirming the long term trend.
Once again, if the estimated returns for the next 15 years (age 90) were to be 7% annually, I would be very happy.
This scenario would be my “base case”
However, we should expect a recession during this span of time; it is not a matter of “if” but “when”.
In the past recessions, most of the following indicators (yield curve, inflation trends, labour market, credit/liquidity situation, ISM index, earnings quality and housing market) painted a recessionary picture. The average market drop of the last 4 recessions was around 40%, the average duration around 1 year and the average recovery period around 2 years.
At present, and for now; all of these indicators are in an expansionary mode.
What should I do to prepare for or react to the upcoming recession hits?
1. I could ride the recession (stay invested); in this scenario, my annual income would be 21% lower than in the base case.
2. I could exit after the start of the recession (while closely observing the leading indicators). Incur a 20% drop in the value of my portfolio (vs 40%), partially miss the first part of the recovery and obtain 15% (vs assumed 33%) and on to the second leg 25% recovery. In this scenario, my annual income would be 4% lower than in the base case. This outcome would be quite acceptable; it’s just like a rounding error.
3. I could also try to be “cute” and exit just before the start of the recession. This scenario would be a “non-starter” because it implies “timing the market”. Imagine if I exited the market in early 2019 and the recession did not hit until 2 years later……
I’m therefore leaning towards scenario 2. What do you think? What do you suggest?
Thanks, as always,
Antoine
Your January update (like everything else that you do) was much appreciated.
Over the past decade, whereas I would have been satisfied with a 7% compound annual return in order to meet my income needs, my RRIF portfolio registered a growth rate of 15% compound p.a. That’s great! However, in the last 3 years while I kept expecting a lower return, the actual returns kept confirming the long term trend.
Once again, if the estimated returns for the next 15 years (age 90) were to be 7% annually, I would be very happy.
This scenario would be my “base case”
However, we should expect a recession during this span of time; it is not a matter of “if” but “when”.
In the past recessions, most of the following indicators (yield curve, inflation trends, labour market, credit/liquidity situation, ISM index, earnings quality and housing market) painted a recessionary picture. The average market drop of the last 4 recessions was around 40%, the average duration around 1 year and the average recovery period around 2 years.
At present, and for now; all of these indicators are in an expansionary mode.
What should I do to prepare for or react to the upcoming recession hits?
1. I could ride the recession (stay invested); in this scenario, my annual income would be 21% lower than in the base case.
2. I could exit after the start of the recession (while closely observing the leading indicators). Incur a 20% drop in the value of my portfolio (vs 40%), partially miss the first part of the recovery and obtain 15% (vs assumed 33%) and on to the second leg 25% recovery. In this scenario, my annual income would be 4% lower than in the base case. This outcome would be quite acceptable; it’s just like a rounding error.
3. I could also try to be “cute” and exit just before the start of the recession. This scenario would be a “non-starter” because it implies “timing the market”. Imagine if I exited the market in early 2019 and the recession did not hit until 2 years later……
I’m therefore leaning towards scenario 2. What do you think? What do you suggest?
Thanks, as always,
Antoine
Q: Good morning Peter, Ryan, and Staff,
I notice that 5i often includes a stock in a different sector as compared to the TSX. For example, you have GSY in the Consumer Cyclical sector, but the TSX has it in the Financial sector. Could a case be made to include GSY in the Financial sector? (Has it grown a lot since 5i first started following it, and perhaps has become more "financial"?)
I am confused when looking at a stock that 5i doesn't cover. For example, several members recently have expressed interest in Pollard Banknote PBL. The TSX lists PBL as Consumer Cyclical. Would you concur? When in doubt, where can we determine the appropriate sector for a particular stock?
Thanks in advance for you insight.
I notice that 5i often includes a stock in a different sector as compared to the TSX. For example, you have GSY in the Consumer Cyclical sector, but the TSX has it in the Financial sector. Could a case be made to include GSY in the Financial sector? (Has it grown a lot since 5i first started following it, and perhaps has become more "financial"?)
I am confused when looking at a stock that 5i doesn't cover. For example, several members recently have expressed interest in Pollard Banknote PBL. The TSX lists PBL as Consumer Cyclical. Would you concur? When in doubt, where can we determine the appropriate sector for a particular stock?
Thanks in advance for you insight.
Q: I see you use these Greek origin words often. Please explain what they mean.
Thanks,
Jim
Thanks,
Jim
Q: please let me know your thoughts about:
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etfc,dsg,mu,mlco,eem,cbl,eifkwh.un,bep.un,spb,vnr
Q: Gentlemen: Gary Shilling says that 50% of returns are from knowing the direction of the market, 30% from the right sector and 20% from having the right stock. Along this line, please comment on where you see opportunities or risks now with specific examples please. I e direction, favourite sectors, and favourite stocks. Tks-JP
Q: Do not chuckle at my ignorance here please, but my question here is on ETF and Mutual Fund fees bought in self directed brokerage portfolios. If a posted managed fee (ie 1.5%) where does that withdraw fee show up and is it taken our annually or monthly? I never see a charge on my monthly statements for the etf management fees. How are they calculated, on the purchase price or a share value on a set date? Thanks
Q: Hi team
I have some money invested in this fund, Fidelity Magellan
it used to be managed by Peter Lynch
the US market has done well
Buy, hold or sell ? thanks
Michael
if you do not cover this fund, not sure if I should use the credit for the questions ?
I have some money invested in this fund, Fidelity Magellan
it used to be managed by Peter Lynch
the US market has done well
Buy, hold or sell ? thanks
Michael
if you do not cover this fund, not sure if I should use the credit for the questions ?
Q: Greetings.
I am planning on early retiring next year at 55. I am looking to transition my portfolio form balanced/growth to income. It would seem that although timing the market is not a predictable strategy, it would seem to me that this is probably the perfect time to transition my portfolio given the weaknesses in the utilities, telecom, pipes etc.
I have cash saved for my first 2 years of retirement to avoid being forced to withdraw funds at a 'inopportune time'. However, i also know my portfolio may need to last a number of years prior to being able to claim cpp, oas and social security (spouse of american citizen collecting social security). Would you recommend transitioning now or do i risk too much growth in the next while? Your thoughts/recommendations are always appreciated.
Cheers
I am planning on early retiring next year at 55. I am looking to transition my portfolio form balanced/growth to income. It would seem that although timing the market is not a predictable strategy, it would seem to me that this is probably the perfect time to transition my portfolio given the weaknesses in the utilities, telecom, pipes etc.
I have cash saved for my first 2 years of retirement to avoid being forced to withdraw funds at a 'inopportune time'. However, i also know my portfolio may need to last a number of years prior to being able to claim cpp, oas and social security (spouse of american citizen collecting social security). Would you recommend transitioning now or do i risk too much growth in the next while? Your thoughts/recommendations are always appreciated.
Cheers
Q: TD Waterhouse said, they did not have any US Treasury Bills in their inventory. Therefore, I could not buy any US Treasury Bills. Is this right and where can you go to buy? TD does have TD Ameritrade in the US, why would they not have US Treasury Bills there?
Q: Greetings
What’s your view of companies that offer to repurchase shares via a ‘normal course issuer bid’ and simultaneously issue a similar amount of stock to officers and directors through stock options? The two activities run more or less concurrently but of course are issued under separate notifications.
Thank you
What’s your view of companies that offer to repurchase shares via a ‘normal course issuer bid’ and simultaneously issue a similar amount of stock to officers and directors through stock options? The two activities run more or less concurrently but of course are issued under separate notifications.
Thank you
Q: What is your opinion on Fidelity Can.Large Cap B (Fid.231)?
It still has 4 Stars, but had zero return in 2017.
What do you see in the future for this fund?
Thank you.
It still has 4 Stars, but had zero return in 2017.
What do you see in the future for this fund?
Thank you.