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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: As between the two Canadian Fixed Income ETFs - XBB, VAB and ZAG - which ones) would be your choice? Or would it make sense to have exposure to all?
Read Answer Asked by M on May 09, 2018
Q: 5-I,
I am looking at a managed portfolio of a friend who deals at Wood Gundy. They are comparing the performance of the portfolio to the "Value Balanced Index". It says it is a blended benchmark comprised of 40% DEX Universe, 20% S&P/TSX composite and 40% MSCI World. What would be the closest ETF to this index that I could follow on an exchange ?

Thanks

Paul
Read Answer Asked by paul on April 23, 2018
Q: Hi 5i. FI = Fixed Income

My (6) FI holdings with rough total returns (including MER & dividends) for period held (average ~ 1.5 years): CBO -1.3%, CPD +15.0%, HFR +1.7%, XBB -2.2%, XHY+5.5%, LQD -0.6%.

NOTE: LQD not selectable, so picked HYG for question above.

Question: I understand the reasoning behind having the above FI holdings in my portfolio, but holding CBO & XBB seems like a sure way to lose money. So why not move CBO & XBB holdings to HFR (and possibly also XHY) which at least returns me ~ +1.7% pretty reliably? Your opinion on my FI mix would also be appreciated.

Thank you for continued solid wise advice.
Read Answer Asked by Paul on April 10, 2018
Q: Hello 5i:
We currently hold about 4% of our portfolio in CSU.DB; bought first about 3 years ago with subsequent additions. It's been a very good and stable performer (thanks for the tip as in addition to the excellent dividend, we also have capital gains). Can you provide another name, possibly A ranked company that would have a similar fixed income contribution? Or, should we merely increase our weighting in CSU.DB?
btw, we also hold CSU (the regular equity) at about 3% of our portfolio.

thanks
Paul L
Read Answer Asked by Paul on April 03, 2018
Q: I currently hold this Bond Fund. I'm looking to add a bit more fixed income. This fund is well below NAV right now, has declined about 2.8% in the last year (most of this in the last month or 2), but has a nice yield of close to 6%. I am up on the year by 3% which seems fine to me, considering savings accounts pay .05% these days. Should I add to this one or are there others that might grow a bit in this environment? It seems most of them are well below NAV at the moment. Thank you!
Read Answer Asked by John on March 12, 2018
Q: I keep reading the traditional fixed income portion of a portfolio that has been allocated to bonds in the past, is a bad idea as a long term investment going forward. With that being said, what type of investments/products would you suggest the average investor allocate the fixed income portion of their portfolio going forward?
Thanks
Read Answer Asked by Curtis on March 04, 2018
Q: Do you recommend buying individual bonds through a discount brokerage account or simply an etf for fixed income ? Would it generate about the same return ? Would you know about the fee through discount brokerage account (it seems to be hidden in the YTM)? I d also be interested in members tips or comments if any. Thank you !
Read Answer Asked by Pierre on February 28, 2018
Q: Hello Folks:
My question is most basic re: bond and equity market price relationships.
I understand for bond yields to rise; either bond prices must trade lower or new ones issued with higher yields.
Commentators advise because of higher bond yields, people hesitant about equity market risk are moving money into the bond market.
With fewer people chasing stocks I can understand this could somewhat dampen stock prices.
What I do not understand is the reverse in the bond market.....more money from stock sale proceeds chasing bonds in the fixed income market should increase bond prices depressing yields.
I would appreciate if you can help with this basic finance 101 question.
Thanks for everything
brian
Read Answer Asked by Brian on February 08, 2018
Q: Can you recommend 2 or 3 bond funds in Canadian $ that would be the least volatile and offer a return for a 3 to 5 year hold? I would prefer one Canadian and one U.S. or international. This would be my sole fixed income holding. Thanx
Read Answer Asked by Steve on February 01, 2018
Q: I have owned these Bond ETF's for the last few years and have seen the unit prices drift lower with the rising rate environment. If I had bought the bonds directly the maturity date would restore the capital. Does the same thing happen within the ETF's to the same effect? How doe s it play out over time?
Thanks
Paul
Read Answer Asked by Paul on January 29, 2018
Q: In the current interest rate environment what bond ETF would you recommend as a core bond holding in an RRSP. Time frame would be long.
Read Answer Asked by Joe on January 29, 2018
Q: 1. In a rising interest rate environment is a convertible bond fund better to hold than other bond funds like xbb, cbo or clf?

2. What would you suggest for the best combination of protection I.e safety and income?

Thanks.
Read Answer Asked by Donald on January 23, 2018
Q: Good morning 5i
I can identify with Neil, who wrote about buying bonds at this time and finds them going down and also looking for an alternative. I have no bond allocation, either, and a couple of months ago bough BSV:US, just putting my toe in to test it. Like Neil, I am also down a little, even after the payouts.
So, I have been wondering whether it would be a reasonable strategy to wait this period out. Would it make sense, for instance, to buy something like FLOT in the US in order to do this? If so, is there anything similar in Canada, as well?
thanks
Read Answer Asked by joseph on January 17, 2018
Q: I have never held bonds only equities. About a month ago bought xbb and xhy, now 15% of my holdings in my portfolio. I'm down about 2.12 % in XHY and about 0.7% in XBB in a very short time. Please tell me why I'm holding these bonds. When I can typically expect them to gain or lose; What sort of insurance/protection they offer me if that is the right word.
Read Answer Asked by Neil on January 16, 2018
Q: I am contemplating selling some or all of my position( $17k, 8% weight in my RSP) In XBB in hopes of climbing the ladder a bit in yield & the possibility of some growth, while keeping the risk factor somewhat the same or perhaps a tad higher. My RSP is reasonably well diversified. Could you recommend a couple of ideas, or just stay put?
Thanks,
Ted
Read Answer Asked by Ted on January 11, 2018
Q: Hi & thank you for continued sound advise.

I'm a Balance/Growth Investor with ~ 30% Fixed Income.

- Current Fixed Income: XBB (30%), CBO (40%), CPD (15%), XHY (15%).
- Planned Fixed Income: MMF659 (70%), CPD (15%), XHY (15%).

Reasons for change:
- Tired of poor returns of CBO, XBB.
- Want more diversifies (USA, INT) fixed income securities.
- The ~ 1% MMF659 MER seems worth it based on 6.23% compound return since inception [2005-11-25].

Haven't held a Mutual Fund in 8 years, but... Yours thoughts would be welcomed here. Thank you!

Paul
Read Answer Asked by Paul on January 09, 2018
Q: Good morning from the West Coast.
Merry Christmas and a Profitable New Year to all the staff at 5I.
My question : Is there a CDN ETF that has a monthly payout please?
Thanks
Rick
Read Answer Asked by Richard on December 22, 2017
Q: given current markets, what percentage of the above etf's would you hold for fixed income...thanks.
Read Answer Asked by Curtis on December 13, 2017
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