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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: What are your favourite Canadian bond ETFs given the current circumstances and looking ahead a couple of years.
Thank you!

Read Answer Asked by Carlos on January 23, 2023

Q: I noted and likely your strategy to add to XHY for income and possible capital gains. However, when I looked at high yield corp. bond ETFs, ZJK looked better overall. There is also the matter of CAD hedging. I'm looking to park cash for my 2023 RIF withdrawal this December and I've been using the BMO HISA for this. Can I have your opinion on using ZJK or XHY instead for about 2% higher income?

Read Answer Asked by Earl on January 12, 2023

Q: I have 20 Thousand US Cash in My US RRIF acc't. I am looking at deploying it into 5 stocks for income. I don't have any oil sector stocks or ETF, Reits or banks.Looking for idea's which could bring dividends and growth over time.Tks 5i take as many credits as required. 79 year old.Do not need any money to pay my RRIF monthly payment as I have Can account with ample cash for 18 months

Read Answer Asked by Guy on January 12, 2023

Q: I'm looking at my legacy pile of preferred shares of which I have never been fond and wondering if this isn't a good time to sell and invest in a bond ETF such as XHY. I know you have expressed ambivalence about prefs but have also said in better times the class can do better. However, yields are roughly comparable, I can use the loses and invest the proceeds in XHY or a different bond fund which you might suggest, keeping the investment on the fixed income side of the page, Many thanks. al

Read Answer Asked by alex on January 12, 2023

Q: Hello,
Many experts are predicting a downturn in the market for at least the first half of 2023 and possible even longer. With that in mind, and if the Feds and Bank of Canada pause in Q1,... the market will stabilize and GIC rates may pull back. In fact RBC GIC's short term rates are about the same as longer term. Therefore, is this a good time to start buying Bonds ETFs with the hope that as rates start coming down the stock price will start moving higher? Am I correct in this assumption? And, which ones would you suggest? short, mid, or long term.? As well, what are you thoughts on Prime Linked Cashable GIC's ( offered by RBC)? Finally, would you buy a 1 year GIC currently at 4.65% ( by RBC) ?
Thanks
CR

Read Answer Asked by Carlo on January 05, 2023

Q: I am looking to add some bond exposure. I had a look at TLT and XHY.

Here is my own personal view on the economy:

- Interest rates could eventually flatline or even fall later in 2023.

- The economy has a somewhat elevated risk of going into a recession.

- The interest rate hikes have a risk of causing "something to break", possibly triggering a black swan event.

Under the above scenarios I am guessing XHY is not a good option considering the individual ratings of the bonds within this ETF, correct?

I don't necessarily want to invest in preparation for a black swan event that may or may not happen, however I want to prepare a bit for that possibility. If that were to happen I would guess that investors would tend to migrate towards the USD. Would that be beneficial for TLT?

Are there better options?

Read Answer Asked by James on January 04, 2023

Q: I completed the Portfolio Analytics Tool and uploaded my own holdings. It suggested I should invest in 30 percent fixed income - Ive spent my investment years in the equity market - any suggestions for this asset class such as which bonds, what terms, etc ?

Read Answer Asked by Gary on January 04, 2023

Q: My portfolio tracking analysis suggested I purchase fixed income assets - as much as 30 percent. Do you have any suggestions where to start - as Ive always traded in equities. Are there corporate bonds I should purchase if so what timeline? Or simply ETFs which would be preferred and which ones?

Read Answer Asked by Gary on January 03, 2023

Q: Hello 5i,

In your recent update, you are increasing XHY to 6% of the income portfolio. We own quite a bit of ZAG in a non-registered account (about 10% of the total portfolio) that we received this year as part of an inheritance. Given your update, does it make sense to sell some ZAG and replace with XHY? The remainder of investments are in mostly diverse growth stocks and other ETFs on your advice and I'm looking to retire in about 10 years.

Thank you and happy holidays,
John

Read Answer Asked by John on December 28, 2022

Q: I didn't have bonds this year and I wish I did even though it lost value it still did better than my portfolio tilted toward growth. If you were to initiate a bonds presence in your portfolio. Would you rather buy these 2 or one or the other. Any other suggestion is welcome.

Thx

Read Answer Asked by Yves on December 21, 2022

Q: Hello Peter,
This question is relating to your holdings in your Income Model Portfolio. Are all the income declared from these investments qualify for dividends tax credits? Or are they treated as normal income like interest income from GICs and would be subject to our normal tax rate?

If it is taxed at our marginal rate, would you recommend holding these investments in a RRSP account?
Many thanks,
Roger

Read Answer Asked by Roger on December 13, 2022

Q: hello 5i:
We hold the Pimco Monthly Income Fund as our sole Global Fixed Income contributor. We are not displeased with it, but wonder if you favour another ETF, or mutual fund, that could replace it, or complement it. We would probably expect at least a 4.5% distribution. Ideas?
thanks
Paul L

Read Answer Asked by Paul on November 28, 2022

Q: As STIP and TIP have ceased to pay their previously excellent distributions, I have been looking for alternatives with similar distribution, diversification and volatility characteristics. XHY seems a valid choice; however, can you comment/provide alternatives? Thanks.

Read Answer Asked by David on November 23, 2022

Q: In tuesday's globe and mail, Tom Czitron recommeded buying mid term (5-10 year) federal, provincial government, and corporate bonds because they seem to be in the sweet spot between lower risk and higher opportunity, especially if inflation declines and economic growth wanes.
1. Do you agree?
2. Can you recommend names of bonds that fit this bill?
3. please indicate order of buying (best to worse), if any.
thanks

Read Answer Asked by Mary on October 31, 2022

Q: Hi Everyone at 5i!
I am a new retiree and hold these three ETFs as part of my income portfolio . They have all dropped in value , due to increased interest rates and the market in general. These are my really long term holds unless you foresee a problem with this idea.
Cheers,
Tamara

Read Answer Asked by Tamara on October 27, 2022