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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: 5i staff and readers might be interested to hear (and comment on) the outcome of my recent (Oct-Nov 2020) Nutrien tax loss sale/repurchase in a taxable account. When I sold my 2500 Nutrien shares for ~$137,000 (realizing ~$18,000 loss), I purchased (per 5i suggestion) an offsetting position in Mosaic (MOS.US, another fertilizer company). Over the next 30 days, Nutrien stock price rose significantly, and so when it came time to repurchase the Nutrien shares (after 30 day waiting period), they now cost $153,000, i.e., an increase in price for the 2500 shares almost as much as the realized loss (~$16,000 versus ~$18,000)! Fortunately, the Mosaic position rose in the meantime by ~$21,000, rescuing what otherwise would have been a disastrous tax-loss sale. In the end, I am now back in Nutrien (a long-term hold in my portfolio), but the whole round trip experience ended up with no tax savings (in fact, my net capital gain position increased by ~$3000 (i.e., ~$21,000 Mosaic share gain minus ~$18,000 Nutrien realized loss), making the whole effort unhelpful re: saving taxes. This tale illustrates well the potential peril of tax-loss selling. But thank you to 5i for the suggestion to hold Mosaic during the 30-day period, preventing a really bad outcome.
Ted
Read Answer Asked by Ted on December 23, 2020
Q: I am overweight in the Utilities sector and underweight in Materials. I am considering selling some BEPC and using that cash to add to Materials. Is NTR recognized as belonging to Materials in the Portfolio Analytics ? What other suggestions would you have for Materials stocks at this time?
By the way I have found the Portfolio Analytics a great tool for following and planning my investments -Thank you for your great services .
Read Answer Asked by Elizabeth on December 20, 2020
Q: I own 2500 shares (~CA$136,000) of Nutrien (non-registered account) with an unrealized capital loss of approximately $19,000. To realize this loss, I am planning to sell my position in Nutrien with aim to re-buy after 30 days. In the interim, to maintain weighting in that sector, what suggestions do you have for an economically similar security (or securities)? (My holding is currently in a US$ brokerage account, so would be easiest to switch to another US$ security, although I could journal-entry my shares into the corresponding CA$ account, and sell my NTR shares in CA$, if you suggest a CA$ security[ies].)

Ted
Read Answer Asked by Ted on October 26, 2020
Q: I would like to increase my portfolio exposure to materials and industrials. When it comes to materials, I own NTR and was thing of adding a position in SJ. I am not entirely comfortable with this buy (concerns about slow growth), but I can't simply find a better alternative. What are buyable (quality + reasonable valuation) companies in the materials sector that you think are better than SJ? When it comes to industrials, I was think of starting long-term positions in EIF and CAE because of their recovery potential due to low valuation. Is there anything that you find concerning in these two?
Read Answer Asked by Steve on September 02, 2020
Q: Hello Peter, I am intrigued after reading that a Canadian can earn about $50,000 per year of dividend income without paying any income tax. I know about your income portfolio of course, but with a view to maximizing just Canadian eligible dividend income, what would you think of the following portfolio of 14 stocks. Equal weighted, the stocks would yield 5.3%. (Disregard lack of market diversification; this can be achieved in one’s registered accounts.) Also, if one wanted to pare down the list to 10, which 4 would you delete?
BCE, CM, ENB, FTS, CNQ, AQN, CPD, FSZ, MG, KBL, POW, ALA, BIPC and NTR. Thanks!
Read Answer Asked by James on August 27, 2020
Q: I'm 2 years from retirement. I will have a company pension. Within my dividend growth stock portfolio, I've already reached my dividend income goal.

With all the money printing and worldwide government debt, I am looking to increase my gold exposure in attempt to diversify one step further, and (hopefully) provide some investment protection. It may not be the '70's all over again, but hard assets seem to becoming more attractive.

I would like to increase my gold exposure to 20%.
I know weighting is a personal choice, and I know you tend to moreless limit weighting in a given stock to about 5%.
Currently I am at about 5% with CEF, and only about 1% with GDXJ - to potentially provide a bit of torque. I would like increase those weightings to 17% and 3% respectively. Is this reasonable? I don't know if there is really any benefit in splitting the bullion exposure to CEF / PHYS, do you?

How do my NTR (5%), CMP (1%), DBC (1%) commodity investments fit into this picture? Should they be part of the 20% or would you consider those as a separate sector, and thereby figured separately from the overall weighting?

Thanks.
Read Answer Asked by James on August 18, 2020
Q: I would like to add two companies to my portfolio to increase my US dividends. What would you pick from these 5? Currently NTR and QSR have a higher yield. Does this indicate a higher risk and should I look at a lesser Yield in order to preserve capital?
Read Answer Asked by Kelly on July 03, 2020
Q: My Canadian dividend portfolio lacks exposure to materials. I currently hold CCL.B and was considering adding one position in SJ, NTR, or BOS. My goal is owning a good business at a sound valuation with prospects of dividend growth for at a long term. I consider the companies the best in the Canadian universer of stocks when it comes to materials. I am leaning towards NTR, but I am hesitant because I try not to invest in businesses that are very sensitive to commodities prices. Can you comment on these companies, their management, risks, and outlook? What do you think is the best option among the three?
Read Answer Asked by Steve on May 26, 2020
Q: Hello Peter,
If you owned these as full-positioned laggards in your portfolio, but were also a patient, long-term investor and appreciated the dividends, which of the following would you currently hold, sell or add to at this time? FSZ, AW.UN, CSH.UN, T, EWJ, HCG, MX, KBL, APR.UN, ZPR, NTR, TECK.B and CN?
Read Answer Asked by James on May 25, 2020
Q: I realize the whole market pulled back today but Nutrien seems to be on a real downward trend for about a week now. Has there some news that is causing this, I haven't noticed anything particularly negative is recent reports. Please advise if there is something other than a volatile market pulling this stock down.

Also, would you consider this stock a good hold for the next 3 years? I currently hold this and am down close to 25% so am trying to determine if I ride it out or cut my losses.

thanks for your advice.
Paula
Read Answer Asked by Paula on May 14, 2020
Q: Morning 5i,

As someone hoping their is a significant pull back. Seeing the overvalued stretching....

I am looking to add some diversification and growth with the "safest" possible.

My picks are;
BAM.A
BYD
REAL
OTEX
GSY
ATD.B
NTR
CNR
Is their additional ones that you can suggest or a couple swaps that are "better" overall.

Thank you for all the tireless fun!
Read Answer Asked by Adam on May 14, 2020
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