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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, Energy sector was creamed today with 5% decline on the top of 15-20% drop over past week. I also learnt from CNBC that many large investors are buying significant amount of September Puts. We trimmed 25% of our 10% Energy weighting, selling XLE, XEG,CNQ and TOU, mostly at market open. Do you believe , Energy sector could be range bound for near term and has further downside ? Would it be prudent to cut the sector weight to 5%, in General, without being specific to our portfolio ? Which companies would you reduce, in order of priority, among, CNQ, TOU and SU, based on balance sheets and possible further downside caused by Oil/Gas price and recession ? Thanks

Read Answer Asked by rajeev on June 24, 2022

Q: Hi, Oil and Gas sector has come under pressure for past two weeks, with above equities declining 20-30% from their respective highs. Volatility in oil and gas prices could be a reason and other days, it could simply be in sympathy with general markets.
This is in the backdrop of analysts forecasting very strong cash flow generation by all these companies, resulting in outsized shareholder returns and much higher equity prices. We have 10% weighting in the sector ( Not including 5.5% ENB ). Based on the geo-political, demand/supply and other relevant factors, do you believe, this sector still has legs, say another 6-12 months or longer and equities should recover over time. Also, what would cause, in your opinion, for market to change course for this sector, in near future. Thank You

Read Answer Asked by rajeev on June 20, 2022

Q: Hi, A follow up to my question earlier. Do you think, the sharp drop in oil price on Friday and recent weakness in Oil and Gas equities could have been triggered by recession fears ? If this is one of the reasons, with more rate hikes in the cards and probability of a recession going up, in your view, how is the Energy sector likely to hold ? How does a retail investor position for next 6-12 months ? Thanks again

Read Answer Asked by rajeev on June 20, 2022

Q: I have the above in my TFSA along with 5 individual stocks currently.
Any gapes or duplication in the ETFs, Should I just add to each equally with any new contributions to an approx 10-12 % weighting for all and thereafter considerate on individual stocks for more growth torque.

Read Answer Asked by Henry on June 17, 2022

Q: What is your opinion of this ETF for a core long term holding for exposure to the oil and gas industry? Is the MER high/low in your opinion. What alternatives if any would you suggest? Thanks

Read Answer Asked by Kolbi on June 07, 2022

Q: I am always confused on days like this when Canadian oils go one way and American oils the other. I would have thought the sectors would both move mostly in tandem guided by oil and gas prices. But, not for the first time, XEG is down today while XLE is up. Why would that be? Yes, it is a bad market day, but ALL my US oils are up strongly while many of the Canadians (TOU in particular) are down. BTW, what % of a diversified portfolio would you devote to oils and gas today? Should pipelines be included in that consideration?

Read Answer Asked by John on June 06, 2022

Q: Can you suggest some good options in this sector. Thanks

Read Answer Asked by gary on April 29, 2022

Q: Hi,

I am interested in $Cdn ETFs that are designed for inflation and where the underlying securities have pricing power? If any, do you have a favourite? If you have a favourite, the reasons why?

Many Thanks,

Read Answer Asked by Derek on February 15, 2022

Q: As per your team Industrials, tech and materials/energy can be decent sectors in times of inflation.

Can you please recommend USA & Cdn ETF that you would consider holding in each above sector.

Thanks for the great service.

Read Answer Asked by Hector on January 25, 2022

Q: Hello Peter,
With rising rates, it seems that banks, commodities and industrials do well. Can you please suggest some etfs in Canada that would take advantage of those sectors? For the banks, i am thinking xfn and zeb but unsure of the others. Also, the US banks are taking small hits. Do you think canadian banks will follow suit or are they very different? Thanks very much.

Read Answer Asked by umedali on January 19, 2022

Q: A few weeks ago I asked about the virtues of owning XLE vs XEG. I ended up buying 5 postions in the following: TOU, KEL, WCP, ARX, TVE. Energy is now 3.5% of my overall portfolio.

My question is the following: for US exposure: may you please provide me your highest conviction name. If you had to chose between this US energy name an DIS for a total return in the next twelve months, which of the two would you side with?

Also, for the next twelve months, what portfolio allocation to energy would you deem optimal, given the current macro environnement?

Thank you and please deduct credits as you see fit.

Read Answer Asked by karim on January 18, 2022

Q: For energy exposure, would you have a preference for CAD or US companies.

I am considering XLE vs XEG. Which would you prefer? Would a combination of both be preferable ? Im open to other ETFbs suggestions.

Thank you.

Read Answer Asked by karim on January 12, 2022

Q: I know you generally recommend 10% as a maximum weighting for the energy sector. However my weighting in my unregistered Canadian cash account is now 32% because I followed Eric Nuttall and got in early. I am reluctant to sell for two reasons. One, I would face very substantial capital gains taxes. Two, I believe there is considerable further upside. I am a senior and my question is: is there any practical way of protecting these gains apart from significant selling? I would appreciate Peter's advice.

Read Answer Asked by Peter on January 09, 2022

Q: Hello 5i team:

At this particular time, which ETF do you think worth buying? US based XLE or Canadian based XEG? Is there a ETF based on Europe or the rest of the world?

Will you underweight or overweight energy in one's portfolio? I know in the US energy doesn't play a big role. But in Canadian index, they do.

Thanks in advance.

Read Answer Asked by Savalai on December 07, 2021