Investment Q&A

Q: Thanks very much for answering my question on covered calls as it relates to out 5i portfolios.

Your answer raised another question. If, using my example of AYA, you are called away on your call option and you no longer have AYA in your port.

Would you then, sell an at the money put to reesetablish the position using November option expiry ( or further out)?

Is this what you would do using this strategy?

Q: I own a few of this company.Dell has purchased.We receive VM ware.Is this reason to wait till deal settles.

Q: This pref looks to offer a good yield (~6.4%) and a good capital gain (at current price) in 2018. Am I missing something? Thanks.

Q: Hello Peter, after 20 years of mediocre-to-poor investing results (despite being an incredibly smart guy ;-)), I've concluded I'm just either a horrible, or a very unlucky, stock picker. With only 5 or so years til retirement, and with no RSP or TFSA room available, I've decided to build out a non-registered account with, eventually, around 10 companies. I know large-caps aren't your focus, but I'm looking for 'blue-chip' companies, preferably mostly dividend payers, and I'm prepared to sacrifice significant growth for a 'reasonable' assurance of capital preservation. I've started with ENB and TELUS (choices I trust you'd agree with, though you may want to run and sell these now). Can you please suggest a further five companies for this account to acquire over the next several months? (I was considering Cdn Tire for one? Your thoughts appreciated.) Finally, if you could add two similar choices from the US, that would be great.

Q: Thanks for your great service. Any thoughts re EPAM? Recent breakout from consolidated period on chart.

Q: Any thoughts on LOW VOLATILITY CANADIAN EQUITIES INCOME FUND?

Q: What two stocks would you recommend from the Growth Portfolio as having the greatest potential returns over the next two years?

Q: Just a comment.This is MNW's response to Elliott.MNW welcomed Elliott's interest & it shared the fund's view on consolidation in the industry.It does not comment on specific M&A discussion.As always,it look forward to creating value for all MNW'shareholders. Note that MNW management was very deligent in attending roadshows & conferences after release of last Q

Q: Mr. Hodson, in light of your answer today to the question by Arneh and the content of the New Jersey DGE report, will your December 08, 2014 Report be updated shortly ? The share price then was 36.85$. Where do you see the share price in 2016 ? Does 50$ or more make sense ?

Is Amaya still one of the next blue chips, and is your faith in the stock fully intact ? David Baazov seems to be one of a kind, and who knows where he will lead Amaya. The AMF inquiry now seems to be of little consequence.

You may publish your response, if you so wish.

Q: Is MFC in the buy range?

Q: Hello Team,
Would you please provide your thoughts on investing in BPY? I do not presently own any REIT type investments. If BPY is purchased on the TSX, will the dividends (unit payments?) I receive be treated as income from a Canadian company or would the US withholding tax apply?
Thanks,
Richard

Q: In response to Richard's earlier question around BPY and dividends, MLP's such as BPY are, from a tax perspective, better off held in a non registered taxable account. This is because MLP have a 35% withholding tax and is even applied if held inside an RRSP. So better to hold in taxable account and get a portion of the withholding tax back through foreign tax credit. There was a Globe and Mail column on the subject a couple years ago if you can find it.
Cheers, from one Richard to another!!

Q: Hello, I've been buying a few stocks from your growth portfolio per month since its inception and now have half. The 11 I don't have yet are:

AVO, CDV, DHX.B, GXI,KXS, BCI,LMP, PEO,PUR, QHR and TC.

I can afford to buy 4 of these this month. Which 4 would you suggest?

Best,

Carla

Q: Read the recent questions re: CSU so will reframe mine as follows:

1. Globe investor shows forward PE at a very reasonable 16.3. Do you concur?

2. The stock has been trading in a range between 530 and 600 for the past three months. CSU has been a massive win for me but has shot up to 13% of my portfolio which I know is too high. It's probably time to abandon the "let winers run" approach and take some money off the table but the real question is this: knowing that a share split is not in the cards per the CEO, and with a tiny yield, have we had our fun? i.e. Do you see a scenario where the stock retests 600 let alone surpasses it?

Thanks as always for your insight.

Q: Can you explain what is "wrong" with this issue (very low and falling price) and why it is, or is not, a reasonable buy for income. I know it will reset at around 4 1/2% at present interest rate scenarios in 2019, but looks pretty good overall with a current yield of ~9.7%. Thanks.

Q: I have a well diversified portfolio of 33% global funds, 33% canadian dividend payers and 33% 5i's growth portfolio. I'm 40 years old and I just inherited an amount equivalent to 25% of my portfolio that I would like to invest. I am thinking about adding either BIP.UN or the Venator long/short fund. I don't need the money for twenty years. Which of these would be better? Thanks.

Q: Hello, after several days of decline, stock closed at $169.13 on Oct/9. Technical indicators show stock in OVERSOLD territory with RSI at 14. On July 31, when co. released Q2 results, stock opened at $170.13 and traded as high as $195, just 2 weeks ago. There is a lot to like in this co. due to its consistent performance, solid growth prospects and large insider as well as institutional ownership. I have a decent position in the co. and looking for your advice if it's safe to accumulate more stock at current levels or wait until Nov/5 for Q3 results. In recent past, I have noted that stock has a tendency to shoot up after quarterly releases. Also could you also comment if recent price correction could be as a result of a weak US$ (Higher US$ has provided tailwind to co results) and market concerns about a possible softer Q3 due to lower (?)back to school sales in Avery division and global growth? Thanks for your great work.

Q: Not sure if this was sent earlier.Add some comments to 5I great responses to concerns about NA.Some statistics by Thomson/Reuters o Oct 8: 1) BMO 2)BNS 3)CM 4)NA 5)RY 6) TD ROE: 1)12.06% 2)13.96% 3)19.24% 4)17.1% 5)18.59% 6)13.75% Dividend Yield: 1)4.3% 2)4.5% 3)4.5% 4)4.9% 5)4.1% 6)3.8% Estimated 2016 P/E: 1)10.7 2)10.3 3)10.5 4)8.8 5)10.9 6)11.4 1yr/5yr Return: 1)-8.2%/+28.2% 2)-12.3/=11.2 3)-1.3/+31 4)-17.6/+29.4 5)-8.1/+35.8 6)-1.1/+43.1 As per BNN re Tier 1 capital 1)9.7 2)10.3 3)10.3 4)9.8 5)9.41 5)9.96 CM is the only North America bank to appear in the World's 20 strongest banks since computed(think in 2011),currently ranked # 18.All our big 6 banks are in the top 50 safest Banks in the World.Our banks operate in an oligopoly environment & the big 6 each takes turn to be top performer.The financial sector is closely supervised by SOFI,an arm of the Federal Gov'T.Recenly many guests on BNN have been positive & recommend the big 6 mainly due to high dividend,historically low P/E & decent returns over time.I am a senior & they are my "sleep at night stocks" in addition to 5I Balanced Equity Port. Thanks

Q: Hi 5i

I have $10,000 to invest for my daughter's RRSP portfolio. She already holds BMO, BNS, TD and BEP.UN What investments do you recommend to round out the portfolio?

Thanks, Henk

Q: Hello 5i
Looking for some help with financial statements. Calians balance sheet shows a decrease of 344k in shares outstanding in the last 5 years. The cash flow statement shows that 9160k shares were bought back during the same period. Is this correct and how would the difference be justified? If I'm reading the statements correctly I only see about 7000k shares outstanding. Thanks for all you do.
Les