Investment Q&A

Q: Gentlemen, Good morning
Just a comment, its better to check with the broker, for exemple Direct Investing NB, even if the CSU is on US side, DIBN will convert the U$ div in Ca$ and than in U$, there is a double conversion.
''Q: Derek
You need a Cdn. & US brokerage a/c.'s
e. g. you buy 100 shs. CSU in your Cdn. a/c.
After settlement call the broker & tell them to tfr. the 100 CSU to your US a/c. Now the US div. will go into your US a/c. Should not be a problem buying CDN Co.'s that pay US divs. & accumulate those divs. in your US
brokerage a/c.
Joe"

Q: I inherited 500 shares of Shaw recently which is 1.4% of my portfolio. I am not a big fan of the cable business as it faces headwinds from streaming services, but I understand their cell business is picking up. However, I already own a significant position in BCE (7% of portfolio).

Do you think I should hold or sell?

Q: Hi 5iResearch team,
I was thinking of replacing KXS that I have held for just over 1 year, with COV and would like to get your thoughts on this.
Cheers,

Q: I halved my holdings some time ago and it's continued to drop to the point that it's too small a part of my overall portfolio to have much impact one way or another. Because I bought it early on, I'm still ahead, but I'm wondering what I should do. Buy more to bring it up to say a half position again, sell it, or let it ride. I'm looking to make my portfolio more conservative and low maintenance in my later retirement.

Q: I hold GILD after averaging down and I am still down I am tempted to switch to Celgene for better recovery opportunity. Please give me your expert opinion.
Raouf

Q: I will be retiring at the end of the year.
My theory is that inflation is about to rise at a quicker rate than it has recently.
The listed securities are in my portfolio and are hurt by rising interest rates.
Which ones would you suggest that I lighten up on.
Which ones would be a hold.

Q: My portfolio is up 25% YTD. If my personal goal is 20% / year do I pack it in and sell everything until the next drop?

Q: Could you provide your thoughts on FAH as a long term investment? What should I know? Eg what are your thoughts on the advisory fees and the voting domination by Fairfax? They seem to think book value per share is a key performance metric, is that the number you would focus on?

Q: Hi 5i team,
Apart from investing in stocks, bonds, and real estate, high net worth individuals and pension funds also invest in 'Alternative investments'. What are alternative investments? And how can individual retail investor diversify and buy into Alternative Investments? Thanks.

Q: What is your opinion on Align Technologies and Editas? I've read that they are forerunners in their respective fields and although expensive, have high growth potential. What's your analysis?

Q: Greetings 5i,

Despite their lacklustre performance this year, I am very fond of consumer staple holdings that focus on food and household products. My reasoning is that I consider their essentiality, as well as their (at least theoretically) defensive nature make them excellent, steady, long-term holds that do not need to be constantly monitored; thereby providing a "sleep at night" factor which I highly prize. Thus, my current sector exposure consists of full positions (5%) in L and PG that, barring some fundamental catastrophe in either, I intend to hold indefinitely. I also hold AMZN (5%), but, due to the breadth of its business, consider it more of a "hybrid."

To these, I am considering adding a position in COST, as I feel that, in addition the aforementioned reasons for favouring staples, its business model is perhaps better equipped to withstand the "Amazon effect" than many other retailers (WMT, KG, etc.). I am also looking to add some geographic diversity to my retail exposure, and view the recent weakness in the stock as a good potential entry point.

However, I realize that this addition would increase my sector weighting, and possibly create some unnecessary overlap. I would therefore like to ask your advice regarding this addition, and whether my reasoning appears sound.

I am 36 years old, debt-free, and relatively conservative. My investment portfolio is solely for the purpose of expediting my retirement, and I will have no need of its funds for the foreseeable future. Excluding ETF's, my portfolio currently consists of 22 positions (with none exceeding a 5% weighting), and is, for my goals and investing style, well diversified across sectors.

Based on my situation, does the addition of COST sound like a reasonable course of action to you?

Thank you.

Q: Hey guys:
I presently hold 12 stocks within my portfolio and most likely will adding a couple more names when funds are available. I don’t understand how retail investors could hold anymore then 20. Could you give your opinion on how many stocks one should hold for an average joe retail investor .
Thank you
Mark

Q: Does the bigger than average volume in the middle of may give us any clue to the direction this company may be heading, should it be viewed as good or just another blip, could it represent support.

Q: Hello 5i,
Crius has a 248.6% Payout Ratio for the March 31 2018 quarter! It is claimed that this is for Phantom Unit Rights: cash paid in compensation for time invested by upper echelon. This is according to a Phantom Units Rights Plan (PURP). Does this take place every three years? Distributable Cash was 3.7 million and total distribution was 9.2 million. Does this make sense?
I hope that words involving "phantom" and "PURP" are words that actually do bode well for future success.

Q: Hi 5i,
In Jan 2018, I added mtum to my mom’s tfsa as her us $ holding. It would represent the most risky part of her holdings in the Tfsa
Since then, I have read that momentum stocks/strategies do not do well in a bear market. Is there any truth to that claim? With a pb over 4 and a pe over 26 should I stay the course, or purchase 2 or 3 value stocks in her account with that us $?. If the latter, any suggestions?
Many thanks,

Q: 1)Can you recommend a CDN ETF for the US consumer discretionary index?
2) Should it be hedged or unhedged?
3) Is there another Canadian ETF that is a more general reflection of the US market that you recommend for a long term hold?

Q: Hey guys:

I have been debating whether to establish a position in this name . Every time I am in there with my kids, it is crazy busy. It has been consolidating as of late. Would it be a good time to buy?
Thank you
Mark

Q: Further to a question about directing USD dividends (paid by Canadian companies) to a USD bank account: I think the question is both more complicated and more simple than 5i's answer suggests.

As is generally understood, a number of Canadian companies - for example, CSU, NSU, and OTEX - can by bought/sold in either CAD or USD, but pay dividends in USD. At the same time, many Canadians have occasion to make purchases in USD. This leads to three questions:

1) is it better to buy/sell in CAD, or in USD?

2) how do you accept USD dividends without paying currency conversion costs?

3) how do you move USD from a brokerage account to a banking account without paying currency conversion costs?

As concerns (1): supposing that the stock were equally liquid on Canadian and American exchanges, the question comes down to tax-preparation preferences. If you buy/sell in CAD, then you don't have to do currency conversions when determining the adjusted cost base.

As concerns (2): any competent brokerage will have some way of accepting USD-denominated dividends without currency conversion. For example, at TD, if you held CSU/NSU/OTEX/etc in a USD-denominated account, then dividends would be accepted in USD. To move a position from a CAD account to a USD account, you ask the broker to 'journal' the position from one account to the other. Journalling incurs no currency conversion fees, but you will have to remember to ask the broker to do the journalling for you, each time you make a purchase (or sale.) And, of course, you will still have to currency-convert the amount of each dividend for tax-preparation purposes.

Note that some brokerages - for example, Interactive - do not segregate CAD- and USD-denominated stocks in separate accounts.

As concerns (3): some banks - for example, TD - provide for USD-denominated accounts/cards. Once you've set this up, you should be able to move funds from a (TD) USD brokerage account to a USD bank account or credit card in much the same way as you would CAD-denominated funds. Of course, the bank will charge you a fee (or require a minimum balance) for this.

Clearly, there are certain dependencies, here, on the services of particular banks/brokerages. In general, however, it should be possible to do as the member asked: direct USD dividends to a USD bank account without (double) currency conversion.

Q: Good day...my question is concerning 5 G being the new evolution in wireless...which companies in your 3 portfolios would be part of this expansion and if you could rate them highest possibility to lowest possibility...also, thanks for the great education that I am receiving from being a member...Eugene

Q: I am interested in your views on the current market cycle. How much longer do you think price appreciation in the Canadian housing and stock markets will continue? And what would be factors that could cause a weakening in those markets?