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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: Hello 5i
With National Bank having ownership stake in Fiera Capital and National taking action to reduce costs and bolster capital, what are your thoughts on National exiting Fiera Capital?
Clearly if this did come to pass, a stock overhang and likely downward pressure on FSZ would develop yes?

The chart(FSZ 1yr) shows signs the stock price could break down as easily as up and the 3 yr shows FSZ in a long downtrend.

Would you be entering here($12.06 Pre-open today) and if yes, with what expectation and holding period?

Thanks
Dave
Read Answer Asked by David on October 28, 2016
Q: Hi,

I own ALA and IPL. I was going through the Q3 report for ALA and there were a couple of points that concerned me. First is that the Company has a working capital deficiency in the third quarter of $287 million for a quick ratio of 0.67. They also didn't generate enough funds from operations to cover their dividend payments and capex for the quarter. Debt to total capitalization is reasonable at 45%, but some other metrics are less rosy. I realize that some of the cash flow shortfall can be offset by the DRIP. Are you concerned by these metrics? IPL also had a small working capital deficiency in Q2 2016, but not a cash flow shortfall. Is it expected in these high leveraged businesses?

Thanks,
Jason
Read Answer Asked by Jason on October 28, 2016
Q: My portfolio is predominantly made up of 4 company's stocks. They are ATD.B, GIL, HCG and SJ. With the exception of SJ (bought it in 2006) I have owned them all since 2002. I have significant capital gains from them all and have been selling them off slowly over the past three years. In each of the past three years I paid significant taxes due to the sale of these shares. I have tried to offset some of the gains by selling some of my losers but the gains are much higher and selling my losers makes the imbalance in my portfolio greater. Do you have a suggestion on how I can help balance my portfolio and avoid paying significant capital gains taxes?
Read Answer Asked by Robert on October 28, 2016
Q: I'm currently 50% in cash (although understandably I shouldn't be). I am contemplating allocating 70% of my entire portfolio to the Balanced equity model to represent Canada and the remainder (30%) to Vanguard's total market US market ETF - VUN.TO. In the past I have tried to stock pick myself using some suggestions from this site and have not come anywhere close to the performance you have achieved with the Balanced Equity model. What is your opinion on the 70% CAD market and 30% US market allocation? Thanks!
Read Answer Asked by Patrick on October 28, 2016
Q: I've owned this stock for some years and have been disappointed with its movement. I do like the management of the Brookfield companies in general and would like to consider trading out my position with another Brookfield company. What is your opinion on 'BOX' and might you prioritize another Brookfield company?
Read Answer Asked by Claus on October 28, 2016
Q: Hi 5i Team, can you please explain the impact of interest rates of CPD. I understand that last year the rate cut had a negative impact on the ETF and that a couple of years ago talk of rising interest rates hurt preferds. Can you please explain the impacts of either rate increase or cut on CPD?
Thanks
Read Answer Asked by Nancy on October 28, 2016
Q: What do you recommend is the best way of gaining exposure to the Indian stock market? In the past I have purchased Excel India mutual fund and I am considering Fairfax Indian fund. I am a long term investor and plan to hold my position for at least 5 years. I welcome your comments.
Read Answer Asked by Robert on October 28, 2016
Q: Hi Team,
Can you please provide an overview of Union Gas (UNG-C or UNG-P)? What is it's risk/reward profile? TD Waterhouse shows a tiny market cap of ~$7.5M with $1.8B revenue TTM. Is that correct? I don't understand the corporate structure (searches say it is a subsidiary of Spectra Energy with assets of more than $7B). Union Gas issues bonds in its own name though. Can you please shed some light on this?

Thank you, Michael
Read Answer Asked by Michael on October 28, 2016
Q: Many darlings of the past year or so have been hit hard,some very hard eg VRX,CXR & DH(yesterday) & today it was ZZZ.Bruce Campbell#2,who made ZZZ his top pick 4 times since 6/30, voluntarily told Market Call(3pm pt) that he had sold ZZZ as it no longer meet his metrics of EPS growth rate & valuation,& replace it with a better choice,but still like the co.Today ZZZ dropped 6% on big volume(385k).A very volatile market.Hard to make a buck.Note that the big 6 Canadian banks are slow & steady,but returns(average 4% dividend-40/50% p.o.-plus capital appreciation are lower than those darlings in their hey day
Read Answer Asked by Peter on October 28, 2016
Q: I have no exposure to materials (I include SJ as an industrial) in my portfolio. I am reluctant to have exposure to this sector as the volatility and lack of earnings are generally beyond my comfort level. I still feel that I should have some exposure so I was thinking MDI would be a good candidate as it is a lesser risk with leverage to this sector. Can you comment please that this is an appropriate strategy for my risk profile and would you recommend buying MDI at this time?
Read Answer Asked by Robert on October 28, 2016
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