Investment Q&A

Q: Dear Gentlemen,
I am in the process to rebalance my PF, based on 5I Summary list, I have companies classified in Services, Consumer Goods, and Financial Service, I assume that these 3 sectors are not in the 10 TSX sectors.
What do you suggest for these 3 sectors, to merge them them with other sectors or keep them and allow % . If so how much ?
Thanks Best regards.
Quote : On average, we would suggest a portfolio similar to this:
Utilities 15%; Financials 15%; Energy 10%; Materials 5%; Telecom 10%, Industrials 10%; Healthcare 5%; Info Tech 10%; Cons. Discretionary 5%; Consumers Staples 15%.

Q: Hi Peter and team, how would rate Boardwalk compare to Chartwell CHS.un and HR.un? Thanks, Gervais

Q: FC has been paying the same monthly distribution of $0.078 since inception in 1999. The dividend yield is almost always in the 7-8% range and balance sheet appears strong. I'd appreciate your comments on FC going forward and if it would not be a suitable add to your diversified Income Model Portfolio.

Q: What are the risks associated with the shortage of the US dollars around the world? I hear that much of the international money borrowed are in US dollars. Reimbursing this money will cost more as US dollar appreciate. What will be the macro effect of this will be on the different markets? And how an investor can best prevent himself against this downturn?
Thanks. Jean

Q: Robert's Feb 26 question about the arbitrage opportunity in BCE's acquisition of Glentel inspired me to try to calculate the downside risk of buying GLN now. Please correct me if I'm off base in my math. Assuming you can acquire GLN shares now at $24 and a 50/50 cash/stock split on closing, the BCE share price would need to fall to $43.23 [26.50 / 2 = 13.50] + [42.23 x .4974 / 2 = 10.50] = 24.00 total to eliminate any gain. If you were to receive all shares and no cash, break even would be $48.26 [48.26 x .4974 = 24.00]. It's possible BCE could re-visit the $48 range, where it was for much of 2014, but dropping to $43 would seem less likely. As a side note, I see that over 8 million BCE shares traded right at the bell on Friday. Average daily volume is around 2.5 million. Was this simply end of month fund re-balancing?

Q: Hi 5i Team,
I am a bit confused. I own each of these fixed income instruments. All but the CPD have moved upwards in the past six months. Why does CPD not move with the bonds? If I were to add to this group, should I avoid CPD or average down on it? Long term horizon. Should I add to the others?

Q: Hi,
I have these four in my TFSA. A bit heavy on CGX and STN but okay with the imbalance. Long term horizon. Now have about $7500 cash. Would would you recommend?

Q: Hi 5i Team,
I have reasonably balanced portfolio. Looking for growth/stability in non registered cash account. What percentage among these would you spread cash over the next six months? Which ones first and what %? Long term horizon. Any others instead of these ones?

Q: Hi Guys,

I have bought Surge Energy over the past 6 months or so and I am down over 50%. One of my rules is to re-evaluate a company if it drops below 2% of my portfolio. If it stays below the 2% limit for a month, I have to invest more to get it back over 2% or sell my position. I have 2 questions:

1) Should the amount I already have invested influence me?
2) Would you buy or sell SGY today? I cannot just hold.

Thanks for your opinion.
John

Q: Hi there,
I only have a 4% weighting in health care and own JNJ. I would like to increase my health care weighting to 10%. I was thinking of buying some XLV, CCT, and GUD. (CCT and GUD would go in our TFSA's). How does this combo seem in terms of diversification, balancing risk and growth. Any other recommendations instead?
Thanks, Kerri

Q: Hi peter,
whats your take Guardian earning, 15% dividend increase is great.
Some analyst say Guardian shares are undervalued and could be worth north of 25$ if they decide to sold their bmo shares.
thanks

Q: Hello 5 I, Canada Pension Plan purchased 341,900 of Kelso recently and was wondering if I should get excited about this?

Q: Peter, one year ago I purchased IPL over Enbridge and it represents 3.5% of my portfolio. I want to continue to hold the same weighting in a pipeline but was wondering if I should switch to ENB? I buy and hold stocks for the long term.

Stephen

Q: Not a question, just a huge thank you for yesterday's conference. Thoroughly enjoyed you and Messrs. Rothery and Carrigan. Wanted to thank you in person yesterday but you were surrounded by fans. :-))

Q: I am about to invest based on your model equity portfolio. I noticed though that the yearly start date for it is March 31st. Are there significant changes made to the model at this time that might make it worthwhile for me to hold off a month before making my purchases?

Q: In relation to the question i just posted regarding portfolio construction, i have another question. In two different answers you give quite different percentages for asset allocation. I am surprised that there is such a difference in the two. One for "an average investor" gives this breakdown:
For the average investor, based against the TSX sectors, we would suggest these allocations; 
Consumer Staples  5%
Consumer Discretionary 10%
Energy  10%
Info Tech  15%
Materials  10%
Industrials (with some US) 15%
Healthcare  10% (with some US) 
Financials  10%
Telecom  10%
Utilities   5%
Enbridge and IPL do behave more like utilities, but the TSX includes them in the energy sector, so we do as well. Badger has 55% of its business in the oil and gas sector, but the TSX classifies it in Industrial Products. 

In the may 2014 post i cited earlier, which is for a "middle aged conservative" investor, it is like this:

May 05, 2014 (asked by paul)
Question: What sector weightings would you recommend for a conservative middle age investor, with a balanced focus on capital gains and dividends. Thanks
5i Research Answer:
On average, we would suggest a portfolio similar to this:
Utilities 15%; Financials 15%; Energy 10%; Materials 5%; Telecom 10%, Industrials 10%; Healthcare 5%; Info Tech 10%; Cons. Discretionary 5%; Consumers Staples 15%.

Q: hello 5i:
not a question; a comment. I often see people, when asking Peter a question, quote how many analysts are advising buy,etc. Peter hasn't held back on his opinion of this, so here's more ammo:
Concerning equities, an analysis by Bespoke Investment Group recently showed 48.3% of the 12,122 ratings on S&P 500 (NYSEARCA:SPY) stocks were "Buy" (or equivalent) ratings, 44.9% of ratings were a "Hold," and just 6.67% of ratings were a "Sell,"
need I say more?
thanks
Paul L

Q: Hello Peter & Co,
It seems that a few investors are taking some profit today in Health/Pharma & Info Tech; that's healthy as they had gained significantly lately. No need to panic and stay the course, right?
Have a good weekend,
Antoine

Q: Could you please send me the details on the Oceania cruise.Thankyou

Q: CBC will air investigation of EH loan procedures and it appears to be very unflattering, if last nite's National teaser is any indication (loan rates at 57% annualized); stock is off today; short-term or long-term impact?